CACHEFLOW INC, S-8, 2000-09-08

CACHEFLOW INC
S-8, 2000-09-08
COMPUTER INTEGRATED SYSTEMS DESIGN

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As filed with the Securities and Exchange Commission on September 8, 2000
Registration No. 333-_____
================================================================================

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________________

FORM S-8
REGISTRATION STATEMENT
Under
The Securities Act of 1933
___________________

CACHEFLOW INC.
(Exact name of registrant as specified in its charter)

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<S> <C> <C>
Delaware 7373 91-1715963
(State or other jurisdiction (Primary Standard Industrial (IRS Employer
of incorporation or organization) Classification Code Number) Identification No.)
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650 Almanor Avenue
Sunnyvale, California 94086
(Address of principal executive offices) (Zip Code)
___________________

CACHEFLOW INC.
SpringBank Networks, Inc. 2000 Stock Incentive Plan
Shares Acquired Under Written Compensatory Agreements
(Full title of the Plans)
___________________

Michael A. Johnson
Chief Financial Officer
CACHEFLOW INC.
650 Almanor Avenue
Sunnyvale, California 94086
(Name and address of agent for service)
(408) 220-2200
(Telephone number, including area code, of agent for service)
___________________

CALCULATION OF REGISTRATION FEE
================================================================================

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Title of Securities Amount Proposed Maximum Proposed Maximum Amount of
to be to be Offering Price Aggregate Offering Registration
Registered Registered (1) per Share (2) Price (2) Fee
---------- ---------- --------- ----- ---
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SpringBank Networks, Inc. 2000 Stock Incentive Plan
----------------------------------------------------
Options to purchase Common Stock 77,000 N/A N/A N/A
Common Stock (par value $.0001) 77,000 $104.9375 $ 8,080,187.50 $ 2,133.17

Shares Acquired under Written Compensatory Agreements
------------------------------------------------------
Common Stock (par value $.0001) 1,580,429 $104.9375 $165,846,268.20 $43,783.42
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(1) This Registration Statement shall also cover any additional shares of
Common Stock which become issuable under the SpringBank Networks, Inc. 2000
Stock Incentive Plan and Written Compensatory Agreements (including the
shares already acquired under these agreements) by reason of any stock
dividend, stock split, recapitalization or other similar transaction
effected without the receipt of consideration which results in an increase
in the number of the outstanding shares of Common Stock of CacheFlow Inc.

(2) Calculated solely for purposes of this offering under Rule 457(h) of the
Securities Act of 1933, as amended, on the basis of the average of the high
and low price per share of Common Stock of CacheFlow Inc. on August 31,
2000.

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REOFFER PROSPECTUS

Shares of Common Stock
Cacheflow Inc.

This Reoffer Prospectus relates to 1,580,429 shares of the common stock,
par value $0.001 (the "Common Stock"), of Cacheflow Inc. (the "Company"), which
may be offered from time to time by certain shareholders (the "Registered
Stockholders"). It is anticipated that the Registered Stockholders will offer
shares for sale at prevailing prices on the Nasdaq National Market System on the
date of sale. The Company will receive no part of the proceeds of sale made
hereunder. All expenses of registration incurred in connection with this
offering are being borne by the Company, but all selling and other expenses
incurred by the Registered Stockholders will be borne by such Registered
Stockholders.

The Common Stock is traded on the Nasdaq National Market System.

The Registered Stockholders and any broker executing selling orders on
behalf of the Registered Stockholders may be deemed to be "underwriters" within
the meaning of the Securities Act of 1933, as amended (the "1933 Act"), in which
event commissions received by such broker may be deemed to be underwriting
commissions under the 1933 Act.

THESE SECURITIES INVOLVE A HIGH DEGREE OF RISK AND SHOULD BE
CONSIDERED ONLY BY PERSONS WHO CAN AFFORD THE LOSS OF THEIR
ENTIRE INVESTMENT.
SEE "RISK FACTORS" BEGINNING ON PAGE 11.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.

No person is authorized to give any information or to make any
representations, other than those contained in this Prospectus, in connection
with the offering described herein, and, if given or made, such information or
representations must not be relied upon as having been authorized by the Company
or any Registered Stockholder. This Prospectus does not constitute an offer to
sell, or a solicitation of an offer to buy, nor shall there be any sale of these
securities by any person in any jurisdiction in which it is unlawful for such
person to make such offer, solicitation or sale. Neither the delivery of this
Prospectus nor any sale made hereunder shall under any circumstances create an
implication that the information contained herein is correct as of any time
subsequent to the date hereof.

The date of this Prospectus is September 7, 2000.
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CACHEFLOW INC.

FORM S-8 CROSS REFERENCE SHEET SHOWING LOCATION OF INFORMATION
REQUIRED BY PART I OF FORM S-3

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Form S-3 Item Number Location/Heading in Prospectus
-------------------- ------------------------------
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1. Forepart of Registration Statement and Outside Front Cover page
Cover page of Prospectus

2. Inside Front and Outside Back Cover Page of Prospectus Available Information; Incorporation of Certain
Information by Reference

3. Summary Information, Risk Factors and Ratio of Risk Factors
Earnings to Fixed Charges

4. Use of Proceeds Use of Proceeds

5. Determination of Offering Price Not applicable

6. Dilution Not applicable

7. Selling Security Holder Selling Security Holder

8. Plan of Distribution Plan of Distribution

9. Description of Securities to be Registered Not Applicable

10. Interests of Named Experts and Counsel Not Applicable

11. Material Changes Not Applicable

12. Incorporation of Certain Information Documents Incorporated by Reference

13. Disclosure of Commission Position on Indemnification
Indemnification for Securities Act Liabilities
</TABLE>
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AVAILABLE INFORMATION

The Company will be subject to the informational reporting requirements of
the Securities Exchange Act of 1934, as amended (the "1934 Act") upon the first
date on which its Common Stock is registered under Section 12(g) of the 1934 Act
and in accordance therewith will file reports, proxy statements and other
information with the Securities and Exchange Commission (the "SEC"). Such
reports, proxy statements and other information can be inspected and copied at
the Public Reference Room of the SEC, 450 Fifth Street, N.W., Washington, D.C.
20549 and at the SEC's regional offices at 219 South Dearborn Street, Chicago,
IL 60604; 26 Federal Plaza, New York, NY 10007; and 5757 Wilshire Boulevard, Los
Angeles, CA 90036, at prescribed rates. The Common Stock is quoted on the
Nasdaq National Market System. Reports, proxy statements, informational
statements and other information concerning the Company can be inspected at the
offices of the National Association of Securities Dealers, Inc. at 1735 K
Street, N.W., Washington, D.C. 20006.

The Company intends to furnish its stockholders with annual reports
containing additional financial statements and a report thereon by independent
certified public accountants.

A copy of any document incorporated by reference in the Registration
Statement (not including exhibits to the information that is incorporated by
reference unless such exhibits are specifically incorporated by reference into
the information that the Registration Statement incorporates) of which this
Reoffer Prospectus forms a part but which is not delivered with this Reoffer
Prospectus will be provided by the Company without charge to any person
(including any beneficial owner) to whom this Reoffer Prospectus has been
delivered upon the oral or written request of such person. Such request should
be directed to Michael A. Johnson, Cacheflow Inc., 650 Almanor Avenue,
Sunnyvale, California 94086. The Company's telephone number at that location
is (408) 220-2200.

TABLE OF CONTENTS

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THE COMPANY.......................... 2
RISK FACTORS......................... 11
REGISTERED STOCKHOLDER............... 21
PLAN OF DISTRIBUTION................. 21
USE OF PROCEEDS...................... 22
DOCUMENTS INCORPORATED BY REFERENCE.. 22
INDEMNIFICATION...................... 22
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THE COMPANY

PART I.
Overview

CacheFlow Inc., a Delaware corporation also referred to in this report as
"we" or the "Company", was formed on March 13, 1996. We design, develop and
market Internet caching appliances that are purpose-built to accelerate and
optimize the flow of information over the Internet. Our products are deployed
by our customers throughout their network infrastructures to improve the
performance of their networks and reduce network costs, while enhancing network
security. Customers for our products include large and small Internet service
providers, or ISPs, and corporate enterprises. These companies purchase our
products in order to improve the performance of their networks and to
accelerate and optimize the delivery of content to the end-user over the
Internet.

Industry Background

The Internet is dramatically changing the way businesses and individuals
communicate and conduct commerce. As a result, the increasing volume of
Internet traffic is much more than just web surfing; it's big business. The
Gartner Group projects that business-to-business e-commerce revenues will reach
$3.9 trillion by 2003. With this rising volume of traffic, Internet and
Intranet infrastructures are quickly reaching capacity. Slow response times and
site outages due to heavy demand are common outcomes of these overburdened
network infrastructures. For organizations that rely on the web for commerce
and/or operational purposes, these problems can be expected to have a direct,
adverse impact on both the top and bottom lines. For example, Zona Research has
published a study that demonstrates how online customers abandon a site after
more than an 8-second delay. Many of these customers may simply visit a
competitor's site to complete their purchase, potentially never returning to
the "troubled" site. In the past, sites that wanted to avoid these issues had
little choice but to invest in more infrastructure--more servers, more network
equipment, more staff and more data center space.

Now, through the emergence of caching technology, these sites can
effectively address the problems of performance, scaling and management. Caching
optimizes how content is delivered, either moving it closer to the requesting
users or accelerating it outward from the web site. There are two primary types
of caching solutions: software-based and appliance. Software-based approaches
consist of a caching software application running on a general-purpose operating
system like Solaris, Linux or Windows 2000. While these systems offer
flexibility, they suffer from complex administration and potential security
breaches of the well-known operating system. Appliances are self-contained
solutions which are expressly built for caching. Due to this singular design,
they are fast, simple, reliable and secure.

Much as network routing has evolved from a general-purpose to a purpose-
built solution, so is caching. The advantages of a specialized appliance are
clear. When a device is designed to perform a dedicated task, it will perform
that task more effectively than a multi-function alternative. The results of an
appliance approach to caching are significant: reduced web response times,
simpler administration and management, lower network and data center costs,
higher reliability, robust data security and always-accurate content. Driven by
these benefits, the caching appliance market is projected to expand from $440
million in 2000 to $2.1 billion by 2003 (source: GartnerGroup/Dataquest).

The CacheFlow Solution

CacheFlow designs, develops, markets, and sells Internet acceleration and
content management solutions which include specialized devices that are
purpose-built to accelerate and optimize the flow of information over the
Internet. Our products improve response time for Internet users and provide
network administrators and managers a high degree of control over the access,
flow and delivery of Internet content. Our products also reduce the number of
redundant requests for information that must be processed and delivered, thus

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reducing the load on the Internet and corporate networks. The principal
benefits of our Internet caching appliances include:

High Performance. Our purpose-built appliances were designed from
inception for high-performance Internet caching. Our appliances provide high
data throughput and reduce latency, or the time between initiating a request
for data and the completion of the actual data transfer. Even content that is
not stored in our caching appliances is accelerated when the request for that
content goes through a CacheFlow appliance, since our appliances
simultaneously retrieve numerous objects from the origin server. In many
cases, our appliances double the speed of content delivery.

Ease of Installation and Management. Our products are designed for easy
installation and maintenance, reducing the cost and time required for
implementation and use. Network managers at ISPs and enterprises generally
install our appliances in the same racks that hold their servers and other
network equipment. In many cases, our Internet caching appliances can be
installed in under thirty minutes. All of or products provide customers with
a range of management features, functions, user interfaces and modes of
operation. In addition, the software and operating systems of our appliances
are designed to efficiently interact with our customers' existing networking
equipment.

Attractive Return on Investment. By allowing content to be served from a
cache located closer to the user, instead of the origin server on the
Internet, enterprises and ISPs employing our Internet caching appliances
require less network capacity and can reduce data transmission costs. Our
customers better utilize the capacity of their existing network since
redundant traffic is removed from the network and served from the cache. The
need for enterprises engaged in e-commerce to purchase additional servers can
be reduced since our Internet caching appliances eliminate a significant
amount of traffic that could otherwise overload their existing servers,
requiring incremental server capacity. Our products also help to improve the
productivity of Internet users by reducing web response time. Faster
downloading of web content increases productivity and end-user satisfaction.

Security. Our appliances run on a proprietary and purpose-built
operating system. CacheOS is designed to be less vulnerable to unauthorized
entry than caches based on more commonly understood, general-purpose
operating systems, such as Windows NT, UNIX or NetWare. Because it was
designed specifically for caching, CacheOS consists of far fewer lines of
code than general-purpose operating systems, creating fewer potential bugs
and fewer potential ways to break into the operating system. In addition,
CacheOS employs authentication and filtering capabilities that prohibit
unauthorized users from accessing or penetrating through the cache.

Broad Product Suite. Enterprises and ISPs have varying capacity,
reliability and data throughput needs, depending on the size and nature of
their operations. We offer a wide range of products to meet different price,
performance and reliability requirements, and provide an upgrade path to our
customers as they expand their networks. Our products can be deployed in a
variety of environments, ranging from small or remote network locations to
large ISPs or enterprise headquarters.

Delivery of Fresh Web Content. Moving content closer to the user
increases network efficiency, but creates the risk that the content delivered
is not up-to-date, or fresh. Internet caching appliances store content, but
do not originate or own that content, so in order to provide fresh content,
caches must monitor the source of content for changes. Unlike traditional
caches that have no mechanisms to monitor and ensure freshness, our Internet
caching appliances actively check the origin servers and update content
through efficient and sophisticated algorithms that monitor user activity and
the frequency with which source content is changed without requiring
additional capacity or adversely affecting response time. These algorithms
are managed through a control mechanism that allows the network administrator
to easily set the level of freshness delivered by the cache. The algorithms
are self-adapting based on the administrative settings.

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Ability to Manage the Flow of Content. Our Internet caching appliances
are installed at points in the Internet infrastructure where all of the
content being requested by a user can flow through our appliances. Our
appliances are able to take advantage of their placement at this network
juncture to provide a range of additional value-added services, including
user authentication, content filtering, user tracking and control of cached
content.

Customers and Applications

Customers have purchased and used our products for a variety of different
applications. ISPs typically use our products to help generate new sources of
revenue from content providers and/or content consumers (e.g. broadband
services, web hosting, content distribution, etc.), or to reduce their
operating costs by improving their use of network capacity or facilities.
Enterprises typically use our products for handling e-commerce related traffic
and as a replacement for proxy servers. Backlog for products ordered but not
yet shipped was $14.1 million, none and none for the three years ended April
30, 2000, 1999 and 1998.

The following are our principal target markets:

Service Providers

Competition in the service provider market is intense. As a result
service providers are consistently looking for competitive advantage.
Competitive advantage typically comes in one of two forms, additional value
added services which become incremental sources of revenue, or reduced
operating costs which contribute to improved profitability. Our products can
help service providers at both.

Bandwidth gain reduces service provider operating costs. Our caching
appliances store and serve the most frequently requested Internet content
closer to the users requesting that content. By deploying our products
throughout their network, service providers can increase the quantity of
customers they can service without adding to the traffic levels on their
backbone, or adding to the network capacity that they purchase from other
service providers. This "bandwidth gain," allows them to improve quality of
service for existing customers and provide the infrastructure to scale for
new customer additions, all while preserving valuable network capacity and in
turn controlling operating costs.

Improved performance attracts more revenues from end user customers. This
is most apparent amongst the new broadband service providers. Broadband ISPs,
using DSL or cable infrastructure to offer high-speed Internet access, enable
the delivery of a wide range of new content and the ability to make the
Internet a truly interactive medium. However, while these solutions offer
faster access speeds from the user to their ISP, they do not shorten the
physical distance between user and web content or reduce network traffic
congestion on the Internet itself. For example, it does not help to build a
twelve-lane on-ramp to a highway if the highway itself has only two lanes and
it is congested. Despite the ability to move content more quickly, broadband
networks still frequently suffer diminished performance when content must be
transmitted many times over the same network path or when many users request
the same content from the origin server simultaneously. These problems are
particularly acute when the content being transmitted includes large files,
which is the nature of broadband content such as video. Therefore, faster
access speeds do not necessarily result in significantly faster response
times when a user is accessing web content that originated across the
Internet. Consumers, therefore, may not enjoy the full benefit that they
expect from broadband. Our appliances can enhance the capabilities of a
broadband network, helping broadband ISPs compete to attract and retain
customers. Our products help broadband providers deliver better performance
to their customers. This gives broadband providers that use our products a
competitive advantage over their competitors that do not use our products.

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Value added services attracts more revenues from content provider
customers. Content hosting service providers are seeking to capitalize on
the growth of e-commerce. These companies manage the e-commerce infrastructure
and networks for third party content providers, allowing them to focus on
content and customers rather than network management. Content hosting
providers are using caching to accelerate the performance of their hosted
customers' e-commerce sites. To generate performance improvements, service
providers deploy caches in various geographically dispersed data center
locations and distribute site content to these caches. When an online user
accesses a Web site, they are actually directed to the cache in close
proximity to their location. Since content does not have to travel through as
many network points to reach its destination, users see faster response times,
resulting in a more productive web experience.

Enterprise Proxy Server Replacement

The amount of data traffic over many enterprise networks has increased
significantly. For many enterprises, exchanging and accessing information
over their intranets and from the Internet is a strategically important
tool in increasing productivity. With this dependence on remote sources of
information, enterprises face a number of risks, including end user access
of inappropriate content, unauthorized outside entities gaining access to
their networks, unpredictable network traffic volumes, and new traffic
types that, if not controlled, could have adverse effects on network
capacity and performance. Proxy servers are devices that allow the network
administrator to implement corporate policies to control the flow of
information in and out of the network. However, the growth in data traffic
in large enterprises has outpaced the growth in proxy server capacity,
forcing many network administrators to choose between accommodating growth
and maintaining control. The growth in Internet usage has created a number
of difficulties with the performance, management and reliability of
existing proxy server solutions. Our appliances are designed to replace
proxy servers in enterprise networks, enabling Web-dependent organizations
to improve the performance of their networks.

E-commerce

Many organizations have come to rely on their web sites as a means of
attracting new customers and generating additional revenue. Increased
business use of the Internet, coupled with the widespread adoption of e-
commerce by consumers, has resulted in large amounts of traffic flowing to
e-commerce sites. Many organizations' current network infrastructures are
incapable of handling this increase in traffic, resulting in overburdened
firewalls, which are network security systems, and e-commerce servers,
which are used to process commercial transactions over the Internet,
resulting in fewer transactions per day for the e-commerce site.
Furthermore, slower response times and poor quality of service can lead
consumers to become dissatisfied with the e-commerce experience and either
stop making web purchases or go to a competitor's web site where
performance is better, which can result in a loss of potential revenues.
Deploying caches as part of an e-commerce infrastructure solution can improve
capacity, throughput and response times, while helping to reduce costs. By
storing and delivering frequently requested content from caches deployed at
the network boundary, congested e-commerce sites can decrease the traffic load
from Web servers and firewalls. This can result in a network that can serve
more Web pages faster, improving the end-user experience and enabling the
infrastructure to support more transactions.

Products

All of our products are designed as integrated appliances, which are
specialized hardware platforms coupled tightly with our CacheOS operating
system. We have specialized our products around several attributes including
type of content (traditional web or streaming), type of customer (service
provider, enterprise, or ecommerce), and type of deployment (content provider
or content consumer). These specializations allow us to meet the different
price, performance, capacity, feature set, and reliability requirements of both
our customers and our potential customers in each of our target market
segments.

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Current Products include:

100 Series--The CacheFlow 110 Internet caching appliance, the sole model
within the 100 Series, is designed for use by small ISPs and corporate branch
or remote offices. The CacheFlow 110 is designed to support Internet traffic
loads of up to 1.5 million bits per second or the equivalent speed of a T-1
connection.

500 Series--The CacheFlow 500 Series includes our 515, 525 and 545 Internet
caching appliances, which are specifically designed to support ISPs and
enterprises with Internet connections up to 15 million bits per second. The
CacheFlow 500 Series is typically deployed in front of web servers, which are
used to publish information on the Internet, and firewalls, which are network
security systems, and is used for accelerating the delivery of content to ISP
and enterprise users.

3000 Series--The CacheFlow 3000 Series is comprised of high-performance
Internet caching appliances designed specifically to support ISPs and
enterprises with Internet connections from 10 to 45 million bits per second
or the equivalent speed of a T-3 connection. Our 3000 Series is expandable,
providing our customers with the ability to add capacity to the appliance as
their needs grow.

5000 Series--The CacheFlow 5000 Series is comprised of high-performance
Internet caching appliances designed for high scalability and reliability.
The CacheFlow 5000 is highly scalable, designed to support traffic loads
ranging from 45 million bits per second or the equivalent speed of a T-3
connection, to more than 155 million bits per second, the equivalent speed of
an OC-3 connection. Our 5000 Series can contain up to three separate AC or DC
power supplies to allow uninterrupted operation and is expandable, providing
our customers with the ability to add capacity to the appliances as their
needs grow.

The CacheFlow Strategy

Our objective is to be a leading provider of Internet acceleration and
content management solutions by delivering high-performance, innovative
Internet caching appliances. Key elements of our strategy include the
following:

Apply our Content Management Focus to Targeted Market Segments. Since
our inception, we have focused exclusively on developing Internet caching
appliances. We believe this exclusive focus helps us to rapidly identify and
target attractive market opportunities. We are directing our product
development, marketing and sales activities at specific market segments that
we believe represent attractive opportunities based on a demonstrated need
for caching, the opportunity to sell to numerous customers and the level of
existing competition. We are focused on three market segments: service
providers, enterprise proxy server replacement, and e-commerce/distributed
content services. We intend to use our customer relationships in these market
segments to further penetrate these segments as well as other related
markets.

Enhance Capabilities of our Appliances. We intend to use our
technological expertise to meet the needs of the evolving Internet
acceleration and content management market. We plan to continue to develop
both the software and hardware elements of our solution to gain and maintain
a competitive advantage and expand the market for our products. Our
additional efforts to enhance the capabilities of our appliances include
adding more functionality to control the flow of content, customizing
hardware and software to enhance performance and developing enhancements to
improve ease of deployment.

Broaden Distribution Channels. We intend to extend our distribution
channels to meet the anticipated growth in demand for Internet caching
appliances. We plan to continue to expand both our direct and indirect sales
channels in order to continue to extend our marketing reach and increase our
volume distribution. In particular, we plan to enter into relationships with

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additional resellers, systems integrators and original equipment
manufacturers to increase penetration of the enterprise and ISP markets.

Build the CacheFlow Brand. We intend to establish CacheFlow as the
premier brand in the Internet acceleration and content management market. We
believe that brand awareness is important to increase market acceptance of
Internet caching appliances generally and to identify us as a leading
provider of Internet caching appliance solutions. We intend to continue to
educate customers, resellers, systems integrators and original equipment
manufacturers about the value of implementing caching appliances. We believe
a thorough process of explanation and education of our products will help to
promote brand recognition and to further an overall acceptance and
understanding of caching appliances. To this end, we intend to increase our
investments in a broad range of marketing and educational programs.

Strategic Relationships

We believe that our business benefits greatly from working closely with
other leading communications infrastructure suppliers. By collaborating with
others, we are able to design products that interoperate more effectively with
other network devices, add features and functionality to our products and
expand our distribution channels, enabling us to access additional customers
and markets. We have recently established strategic relationships with several
companies, including:

Alcatel

Alcatel is a leading global manufacturer of communications infrastructure
for telecommunications and data networks. We entered into an OEM agreement with
Alcatel that enables Alcatel to resell our Internet caching appliances. Alcatel
has a strong international presence and large customer base, including
international providers of broadband communications services and regional bell
operating companies (RBOCs) in the United States.

Akamai

Akamai provides a content delivery service that improves Web site speed and
reliability. We entered into a strategic alliance with Akamai. The alliance
includes an initiative to integrate caching and content delivery technologies
to accelerate and optimize Web performance. The product is designed to automate
the process of distributing information to caching servers, significantly
decreasing the time required for customers to implement Akamai's services. The
combined solution will help E-commerce and content sites better service online
customers through enhanced performance, scalability and reliability. In
addition to the technology integration, we obtained the right to resell
Akamai's Freeflow caching services and Akamai obtained the right to sell our
caching appliances.

Computer Sciences Corporation

Computer Sciences Corporation , or CSC, is one of the world's leading
consulting and IT services firms. We entered into a global reseller agreement
with CSC that enables CSC to integrate CacheFlow appliances into solutions
offered by its Global Infrastructure Services Group.

Electronic Data Systems

EDS is a global leader in providing e-business and information technology
services. We entered into a global reseller agreement with EDS. The agreement
enables EDS to integrate CacheFlow Internet caching appliances with other
technologies to deliver complete solutions to enterprise, e-commerce and
government customers.

Hewlett-Packard

Hewlett-Packard is a global provider of computing and imaging solutions and
services. We entered into a joint product development and reseller partnership
with Hewlett-Packard. The alliance also includes a global reseller agreement.

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WestCon

WestCon is a global channel provider of networking technology products. We
entered into a distribution agreement with WestCon. They will serve as
CacheFlow's primary distribution arm within North America.

Sales and Marketing

We utilize a combination of our direct sales force, resellers, systems
integrators and original equipment manufacturers as appropriate for each of our
target markets. We support our distribution channels with systems engineers and
customer support personnel that provide technical service and support to our
customers. We have entered into agreements with resellers and network equipment
providers such as Akamai, Alcatel, CSC, EDS, Hewlett Packard, Lucent
Technologies, Nissho Electronics, Sumitronics and WestCon. We intend to pursue
relationships with additional resellers and original equipment manufacturers to
implement our distribution strategy and to expand our customer base. We have
also been expanding our sales force rapidly, and plan to continue to do so in
the future.

Our marketing efforts focus on increasing the market awareness of our
products and technology and promoting the CacheFlow brand. Our strategy is to
create this awareness by distinguishing our products based on their high level
of performance. We have a number of marketing programs to support the sale and
distribution of our products and to inform existing and potential customers
within our target market segments about the capabilities and benefits of our
products. Our marketing efforts include participation in industry tradeshows,
preparation of competitive analyses, sales training, maintenance of our web
site, advertising and public relations.

Research and Development

Following our inception in March 1996, we developed the first version of
CacheOS, which was specifically designed as the operating platform for our
Internet caching appliances. Our research and development efforts are focused
on developing technological improvements to and new versions of our Internet
caching appliances. Research and development expenses were $9.6 million, $4.0
million, and $2.4 million for the fiscal years ended April 30, 2000, 1999, and
1998, respectively.

Our research and development team consists of engineers with extensive
backgrounds in operating systems, algorithms, computer science and network
engineering. We believe that the experience and capabilities of our research
and development professionals represents a competitive advantage for CacheFlow.
In June 2000, the Company acquired SpringBank Networks, adding additional
engineers to our staff as well as complimentary technology. We have worked
closely with several of our customers in developing and enhancing our products.
Our current research and development efforts are primarily focused on three
strategic initiatives:

. developing Internet caching appliances to address price/performance
points for which we do not currently offer products;

. improving the performance of our Internet caching appliances,
including data throughput and response time; and

. adding new features and strengthening the existing features of our
Internet caching appliances to give them enhanced capabilities.

We expect that most of the enhancements to our existing and future products
will be accomplished by a combination of internal development and acquisition.
However, we currently license some technologies and will continue to evaluate
externally developed solutions for integration into our products.

Manufacturing

We currently outsource the manufacturing of all of the subassemblies and
components of our Internet caching appliances, including printed circuit boards,
custom power supplies, chassis, cables and subassemblies, to third parties, and

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we perform final assembly and testing in-house. This approach allows us to
reduce investment in manufacturing capital and to take advantage of the
expertise of our vendors. Our internal manufacturing operations consist
primarily of prototype development, materials planning and procurement, final
assembly, testing and quality control. We plan to subcontract final assembly to
third parties in the future. Our standard parts and components are generally
available from more than one vendor. We typically obtain these components
through purchase orders and currently do not have contractual relationships or
guaranteed supply arrangements with these suppliers. If one of these vendors
ceased to provide us with necessary parts and components, we would likely
encounter delays in product production as we make the transition to another
vendor. We recently hired a Senior Vice President of Manufacturing to implement
new manufacturing strategies and optimize product quality and cost.

Competition

The market for Internet caching solutions is intensely competitive,
evolving and subject to rapid technological change. The intensity of competition
is expected to increase in the future. Increased competition is likely to result
in price reductions, reduced gross margins and loss of market share, any one of
which could seriously harm our business. We may not be able to compete
successfully against current or future competitors and we cannot be certain that
competitive pressures we face will not seriously harm our business. Our
competitors vary in size and in the scope and breadth of the products and
services they offer. We primarily encounter competition from a variety of
companies, including Cisco Systems, Inktomi, Network Appliance, Novell, and
various others using publicly available, free software. In addition, because
there are relatively low barriers to entry in the Internet caching market, we
expect additional competition from other established and emerging companies as
the market for Internet caching continues to develop and expand.

Many of our current and potential competitors have longer operating
histories, significantly greater financial, technical, marketing and other
resources, significantly greater name recognition and a larger installed base of
customers than we do. In addition, many of our competitors have well-established
relationships with our current and potential customers and have extensive
knowledge of our industry. As a result, our competitors may be able to respond
more quickly to new or emerging technologies and changes in customer
requirements, or to devote greater resources to the development, marketing,
promotion and sale of their products than we can. Current and potential
competitors have established or may establish cooperative relationships among
themselves or with third parties to increase the market acceptance of their
products. In addition, our competitors may be able to replicate our products,
make more attractive offers to existing and potential employees and strategic
partners, more quickly develop new products or enhance existing products and
services, or bundle Internet caching appliances in a manner that we cannot
provide. Accordingly, it is possible that new competitors or alliances among
competitors may emerge and rapidly acquire significant market share. We also
expect that competition will increase as a result of industry consolidation.

Intellectual Property and Other Proprietary Rights

We depend significantly on our ability to develop and maintain the
proprietary aspects of our technology. To protect our proprietary technology, we
rely primarily on a combination of contractual provisions, confidentiality
procedures, trade secrets, copyright and trademark laws and patents. Despite our
efforts to protect our proprietary rights, unauthorized parties may attempt to
copy aspects of our products or obtain and use information that we regard as
proprietary. Policing unauthorized use of our products is difficult. In
addition, the laws of some foreign countries do not protect our proprietary
rights to as great an extent as do the laws of the United States. Our means of
protecting our proprietary rights may not be adequate and our competitors may
independently develop similar technology, duplicate our products or design
around patents that may be issued to us or our other intellectual property.

We presently have several pending United States patent applications and
several pending patent applications in foreign patent offices. Although we have
not been issued any patents to date, one patent application pending before the

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United States Patent Office has been allowed and is expected to issue as a
United States patent.

We cannot assure you that any U.S. or international patent will be issued
from these applications. Even if patents are issued, we cannot assure you that
we will be able to detect any infringement or, if infringement is detected, that
patents issued will be enforceable or that any damages awarded to us will be
sufficient to adequately compensate us.

There can be no assurance or guarantee that any products, services or
technologies that we are presently developing, or will develop in the future,
will result in intellectual property that is protectable under law, whether in
the United States or a foreign jurisdiction, that this intellectual property
will produce competitive advantage for us or that the intellectual property of
competitors will not restrict our freedom to operate, or put us at a competitive
disadvantage.

We rely on technology that we license from third parties, including
software that is integrated with internally developed software and used in
CacheOS to perform key functions. For example, we license subscription filtering
technology from Secure Computing. If we are unable to continue to license any of
this software on commercially reasonable terms, we will face delays in releases
of our software or will be required to drop this functionality from our software
until equivalent technology can be identified, licensed or developed, and
integrated into our current product. Any of these delays could seriously harm
our business.

There has been a substantial amount of litigation in the technology
industry regarding intellectual property rights. It is possible that in the
future third parties may claim that we or our current or potential future
products infringe their intellectual property. We expect that companies in the
Internet and networking industries will increasingly be subject to infringement
claims as the number of products and competitors in our industry segment grows
and the functionality of products in different industry segments overlaps. Any
claims, with or without merit, could be time-consuming, result in costly
litigation, cause product shipment delays or require us to enter into royalty or
licensing agreements. Royalty or licensing agreements, if required, may not be
available on terms acceptable to us or at all, which could seriously harm our
business.

Employees

As of April 30, 2000, we had a total of 306 employees, including 68 in
research and development, 173 in sales, marketing and customer support, 26 in
manufacturing and 39 in general and administrative. Of these employees, 246 were
located in North America with 60 located internationally. None of our employees
is represented by collective bargaining agreements, nor have we experienced any
work stoppages. We consider our relations with our employees to be good.

Our future operating results depend significantly upon the continued
service of our key technical, sales and senior management personnel, many of
whom are not bound by an employment agreement. Competition for these personnel
is intense, and we may not be able to retain them in the future. Our future
success also depends upon our continuing ability to attract and retain highly
qualified individuals. We may experience difficulties managing our expected
growth and performance if we are unable to attract and retain qualified
personnel.

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RISK FACTORS

Risks Related to Our Business

We only began selling our products in May 1998 and, as a result, you may have
difficulty evaluating our business and operating results.

We were founded in March 1996 and did not sell any products or services until
May 1998. The market for our products is unproven. Our limited operating history
makes an evaluation of our future prospects very difficult. We expect to
encounter risks and difficulties frequently encountered by early stage companies
in new and rapidly evolving markets. Many of these risks are described in more
detail in this "Factors Affecting Future Operating Results" section. Our
business will be seriously harmed if we do not successfully execute our business
strategy or if we do not successfully address the risks we face.

We have a history of losses, expect to incur future losses and may never achieve
profitability, which could result in the decline of the market price of our
common stock.

We incurred net losses of $25.3 million and $6.6 million for the three months
ended July 31, 2000 and 1999. As of July 31, 2000, we had an accumulated deficit
of $108.1 million. We have not had a profitable quarter since our inception and
we expect to continue to incur net losses in the future. To date, we have funded
our operations from the sale of equity securities and through bank loans and
equipment leases.

We expect to continue to incur significant operating expenses and, as a result,
we will need to generate significant revenues if we are to achieve
profitability. We may never achieve profitability. We expect to incur
substantial non-cash costs relating to the amortization of deferred compensation
and goodwill, which will contribute to our net losses. As of July 31, 2000, we
had an aggregate of $36.2 million of deferred compensation and $167.2 million of
goodwill to be amortized. The Company may record additional compensation expense
in the future if management decides to grant below-market stock options in order
to attract and retain employees in a highly competitive labor market or make
acquisitions that result in the recording of deferred stock compensation.

Because we expect our sales to fluctuate and our costs are relatively fixed in
the short term, our ability to forecast our quarterly operating results is
limited, and if our quarterly operating results are below the expectations of
analysts or investors, the market price of our common stock may decline.

Our net sales and operating results are likely to vary significantly from
quarter to quarter. We believe that quarter-to-quarter comparisons of our
operating results should not be relied upon as indicators of future performance.
It is likely that in some future quarter or quarters, our operating results will
be below the expectations of public market analysts or investors. When this
occurs, the price of our common stock could decrease significantly. A number of
factors are likely to cause variations in our net sales and operating results,
including factors described in this "Factors Affecting Future Operating Results"
section.

We cannot reliably forecast our future quarterly sales for several reasons,
including:

. we have a limited operating history, and the market in which we
compete is relatively new and rapidly evolving;

. we expect that, for the foreseeable future, most of our sales will
come from a small number of customers, so delays or cancellations of
orders by a few customers can significantly impact net sales within a
quarter; and

. our sales cycle varies substantially from customer to customer.

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CACHEFLOW INC.

A high percentage of our expenses, including those related to research and
development, sales and marketing, general and administrative functions and
amortization of deferred compensation and goodwill, are essentially fixed in the
short term. As a result, if our net sales are less than forecasted, our
quarterly operating results are likely to be seriously harmed.

We expect increased competition and, if we do not compete effectively, we could
experience a loss in our market share and sales.

The market for Internet caching solutions is intensely competitive, evolving and
subject to rapid technological change. The intensity of competition is expected
to increase in the future. Increased competition is likely to result in price
reductions, reduced gross margins and loss of market share, any one of which
could seriously harm our business. We may not be able to compete successfully
against current or future competitors and we cannot be certain that competitive
pressures we face will not seriously harm our business. Our competitors vary in
size and in the scope and breadth of the products and services they offer. We
primarily encounter competition from a variety of companies, including Cisco
Systems, Inktomi, Network Appliance, Novell, Dell and various others using
publicly available, free software. In addition, because there are relatively low
barriers to entry in the Internet caching market, we expect additional
competition from other established and emerging companies as the market for
Internet caching continues to develop and expand.

Many of our current and potential competitors have longer operating histories,
significantly greater financial, technical, marketing and other resources,
significantly greater name recognition and a larger installed base of customers
than we do. In addition, many of our competitors have well-established
relationships with our current and potential customers and have extensive
knowledge of our industry. As a result, our competitors may be able to respond
more quickly to new or emerging technologies and changes in customer
requirements, or to devote greater resources to the development, marketing,
promotion and sale of their products than we can. Current and potential
competitors have established or may establish cooperative relationships among
themselves or with third parties to increase the market acceptance of their
products. In addition, our competitors may be able to replicate our products,
make more attractive offers to existing and potential employees and strategic
partners, more quickly develop new products or enhance existing products and
services, or bundle Internet caching appliances in a manner that we cannot
provide. Accordingly, it is possible that new competitors or alliances among
competitors may emerge and rapidly acquire significant market share. We also
expect that competition will increase as a result of industry consolidation.

Our variable sales cycle makes it difficult to predict the timing of a sale or
whether a sale will be made, which makes our quarterly operating results less
predictable.

Because customers have differing views on the strategic importance of
implementing Internet caching appliances, the time required to educate customers
and sell our products can vary widely. As a result, the evaluation, testing,
implementation and acceptance procedures undertaken by customers can vary,
resulting in a variable sales cycle, which typically ranges from two to nine
months. While our customers are evaluating our products and before they place an
order with us, we may incur substantial sales and marketing expenses and expend
significant management efforts. Sales cycles for our products that are sold to
enterprises have traditionally been longer than sales cycles for our products
that are sold to Internet service providers, or ISPs. We expect that sales to
enterprises will increase as a percentage of our total sales over time, and,
accordingly, we expect that the average sales cycle for our products will
increase. In addition, purchases of our products are frequently subject to
unplanned processing and other delays, particularly with respect to larger
customers for whom our products represent a very small percentage of their
overall purchase activity. Large customers typically require approvals at a
number of management levels within their organizations, and, therefore,
frequently have longer sales cycles.

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CACHEFLOW INC.

We are entirely dependent on market acceptance of our Internet caching appliance
product family and, as a result, a decline in sales or lack of market acceptance
of these products could cause our sales to fall.

To date, our Internet caching appliance product family and related services have
accounted for all of our net sales. We anticipate that revenues from our current
product family and services will continue to constitute substantially all of our
net sales for the foreseeable future. As a result, a decline in the prices of,
or demand for, our current product family and services, or their failure to
achieve broad market acceptance, would seriously harm our business. The
CacheFlow 100 Series, 500 Series, 3000 Series and 5000 Series products are the
only products that we currently sell. Our CacheFlow 1000 Series and 2000 Series
products, which have historically accounted for a substantial portion of our net
sales, have been discontinued and replaced by our recently introduced CacheFlow
3000 Series products. We introduced our 3000 Series product in September 1999
and our 5000 Series product in June 1999. We cannot be certain that our
CacheFlow 3000 Series or 5000 Series products will continue to achieve any
significant degree of market acceptance.

If we are unable to introduce new products and services that achieve market
acceptance quickly, we could lose existing and potential customers and our sales
would decrease.

We need to develop and introduce new products and enhancements to existing
products on a timely basis that keep pace with technological developments and
emerging industry standards and address the increasingly sophisticated needs of
our customers. We intend to extend the offerings under our product family in the
future, both by introducing new products and by introducing enhancements to our
existing products. However, we may experience difficulties in doing so, and our
inability to timely and cost-effectively introduce new products and product
enhancements, or the failure of these new products or enhancements to achieve
market acceptance, could seriously harm our business. Life cycles of our
products are difficult to predict, because the market for our products is new
and evolving and characterized by rapid technological change, frequent
enhancements to existing products and new product introductions, changing
customer needs and evolving industry standards. The introduction of competing
products that employ new technologies and emerging industry standards could
render our products and services obsolete and unmarketable or shorten the life
cycles of our products and services. The emergence of new industry standards
might require us to redesign our products. If our products are not in compliance
with industry standards that become widespread, our customers and potential
customers may not purchase our products.

Because we depend on several third-party manufacturers to build portions of our
products, we are susceptible to manufacturing delays and sudden price increases,
which could prevent us from shipping customer orders on time, if at all, and may
result in the loss of sales and customers.

We rely on several third-party manufacturers to build portions of our products.
If we are unable to manage our relationships with these manufacturers
effectively or if these manufacturers fail to meet our future requirements for
timely delivery, our business would be seriously harmed. We have no written
agreement with any of these manufacturers and they fulfill our supply
requirements on the basis of individual purchase orders from us. Accordingly,
these manufacturers are not obligated to continue to fulfill our supply
requirements, and the prices we are charged for these components could be
increased on short notice. Any interruption in the operations of any one of
these manufacturers would adversely affect our ability to meet our scheduled
product deliveries to our customers, which could cause the loss of existing or
potential customers and would seriously harm our business. In addition, the
products that these manufacturers build for us may not be sufficient in quality
or in quantity to meet our needs. Our delivery requirements could exceed the
capacity of these manufacturers, which would likely result in manufacturing
delays, which could result in lost sales and the loss of existing and potential
customers. We cannot be certain that these manufacturers or any other
manufacturer will be able to meet the technological or delivery requirements of
our current products or any future products that we may develop and introduce.
The inability of these manufacturers or any other of our contract manufacturers
in the future to provide us with adequate supplies of high-quality products, or
the loss of any of our contract manufacturers in the future, would cause a delay
in our ability to fulfill customer orders

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CACHEFLOW INC.

while we attempt to obtain a replacement manufacturer. Delays associated with
our attempting to replace or our inability to replace one of our manufacturers
would seriously harm our business.

We may experience production delays, quality control problems and assembly
capacity constraints in assembling our products, which could result in a decline
of sales.

We currently conduct most of the final assembly and all of the testing of our
products at our headquarters in Sunnyvale, California. We have transitioned
final assembly for some of our products to third parties and we may transition
additional final assembly in the future. If we were unable to identify a third-
party final assembler, we would be required to make additional capital
investments in new or existing assembly facilities. To the extent any capital
investments are required, our gross margins and, as a result, our business could
be seriously harmed. We may experience production interruptions or quality
control problems in connection with any transition of final assembly, either of
which would seriously harm our business. Either any third-party assembler or we
may experience substantial assembly capacity constraints. In the event of any
capacity constraints we may be unable to accept certain orders from, and deliver
products in a timely manner to, our customers. This could result in the loss of
existing or potential customers and would seriously harm our business.

Because some of the key components in our products come from limited sources of
supply, we are susceptible to supply shortages or supply changes, which could
disrupt or delay our scheduled product deliveries to our customers and may
result in the loss of sales and customers.

We currently purchase several key parts and components used in the manufacture
of our Internet caching appliances from limited sources of supply. For example,
we purchase custom power supplies and Intel hardware for use in all of our
Internet caching appliances. The introduction by Intel or others of new versions
of their hardware, particularly if not anticipated by us, could require us to
expend significant resources to incorporate this new hardware into our products.
In addition, if Intel or others were to discontinue production of a necessary
part or component, we would be required to expend significant resources in
locating and integrating replacement parts or components from another vendor.
Qualifying additional suppliers for limited source components can be time-
consuming and expensive. Any of these events would be disruptive to us and could
seriously harm our business. Further, financial or other difficulties faced by
these suppliers or unanticipated demand for these parts or components could
limit the availability of these parts or components. Any interruption or delay
in the supply of any of these parts or components, or the inability to obtain
these parts or components from alternate sources at acceptable prices and within
a reasonable amount of time, would seriously harm our ability to meet our
scheduled product deliveries to our customers.

Our use of rolling forecasts could lead to excess or inadequate inventory, which
could seriously harm our business.

We use rolling forecasts based on anticipated product orders, product order
history and backlog to determine our materials requirements. Lead times for the
parts and components that we order vary significantly and depend on factors such
as the specific supplier, contract terms and demand for a component at a given
time. If actual orders do not match our forecasts, we may have excess or
inadequate inventory of some materials and components, which would increase our
costs or prevent or delay product shipments and could seriously harm our
business.

We are dependent upon key personnel and we must attract, assimilate and retain
other highly qualified personnel in the future or our ability to execute our
business strategy or generate sales could be harmed.

Our business could be seriously disrupted if we do not maintain the continued
service of our senior management, research and development and sales personnel.
All of our employees are employed on an "at-will" basis. Our ability to conduct
our business also depends on our continuing ability to attract, hire, train and
retain a substantial number of highly skilled managerial, technical, sales,
marketing and customer support personnel. New hires frequently require extensive
training before they achieve desired levels of productivity, so a high employee
turnover rate could seriously impair our ability to operate and manage our

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CACHEFLOW INC.

business. We are particularly dependent on hiring additional personnel to
increase our direct sales and research and development organizations.
Competition for personnel is intense, especially in the San Francisco Bay Area,
and we may fail to retain our key employees, or attract, assimilate or retain
other highly qualified personnel in the future. If so, our business would be
seriously harmed.

Our management team is new, and our business could be seriously harmed if
integration of our management team into our company is not successful.

We have recently experienced significant transition in our management team.
Brian NeSmith, our President and Chief Executive Officer, joined us in March
1999. Additionally, many members of our senior management team have joined the
company within the past 12 months. Our business could be seriously harmed if
integration of our management team into our company is not successful. We expect
that it will take time for our new management team to integrate into our company
and it is too early to predict whether these changes will be successful.

In order to manage our growth and expansion, we will need to improve and
implement new systems, procedures and controls, which could be time-consuming
and costly.

We have expanded our operations rapidly since the inception of our company and
we currently intend to continue this expansion. This expansion of our operations
has placed and is expected to continue to place a significant strain upon our
management systems and financial and operational resources. If we are unable to
effectively manage future growth and expansion, our business will be seriously
harmed. We currently have research and development facilities in Sunnyvale,
California; Redmond, Washington and Waterloo, Ontario, Canada. The coordination
and management of these product development organizations that are located at
different sites requires significant management attention and coordination,
particularly from our managerial and engineering organizations. If we are unable
to coordinate and manage these separate development organizations, our business
will be seriously harmed.

Our ability to compete effectively and to manage future expansion of our
operations will require us to continue to improve our financial and management
controls, reporting systems and procedures on a timely basis, and expand, train
and manage our employee work force. The number of our employees increased from
40 at April 30, 1998 to 369 at July 31, 2000, and we plan to further increase
our headcount. We recently implemented a new enterprise resource planning
software system that replaced substantially all of our business and
manufacturing systems. While we have not had significant problems to date, we
may encounter difficulties in transitioning to the new enterprise resource
planning software system. Even after we implement this system, our personnel,
systems, procedures and controls may be inadequate to support our future
operations.

If we fail to expand our direct and indirect sales channels, our sales will not
grow.

We need to substantially expand our direct sales operations, both domestically
and internationally, in order to increase market awareness and sales of our
products and services. Our products and services require a sophisticated sales
effort targeted at senior management of our customers. We have recently expanded
our direct sales force and plan to hire additional sales personnel. New hires
will require extensive training and typically take several months to achieve
productivity. Competition for qualified sales personnel is intense, and we might
not be able to hire the kind and number of sales personnel we are targeting. If
we fail to increase our direct sales capabilities as we have planned, our
business will be seriously harmed.

We also need to expand our indirect sales channels, and if we fail to do so our
ability to market and sell our products could be seriously harmed. We depend on
our indirect sales channels, which include resellers, systems integrators and
original equipment manufacturers, for a significant percentage of our net sales.
For example, for the quarter ended July 31, 2000, approximately 45% of our net
sales resulted from sales through indirect channels. Our agreements with our
indirect channel partners are generally not exclusive and in many cases may be
terminated by either party without cause. Many of these indirect channel
partners do not have minimum purchase or resale requirements and carry products
that are competitive with our products. These resellers may not give a high
priority to the marketing of our products or may not

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CACHEFLOW INC.

continue to carry our products. They may give a higher priority to other
products, including the products of competitors. We may not retain any of our
current indirect channel partners or successfully recruit new indirect channel
partners. Events or occurrences of this nature could seriously harm our
business.

If we are unable to expand our customer service and support organization, we may
not be able to retain our existing customers or attract new customers, and our
sales may decline.

We currently have a small customer service and support organization and will
need to increase our capabilities to support new customers and the expanding
needs of our existing customers. If we are unable to expand our customer service
and support organization, we may not be able to retain our existing customers or
attract new customers.

We may not be able to enter into new international markets or generate a
significant level of sales from the international markets in which we currently
operate.

For the quarter ended July 31, 2000, sales to customers outside of the United
States and Canada accounted for approximately 47% of our net sales. We expect
international customers to continue to account for a significant percentage of
net sales in the future, but we may fail to maintain or increase international
market demand for our products. Also, because our international sales are
currently denominated in United States dollars, an increase in the value of the
United States dollar relative to foreign currencies could make our products more
expensive and, therefore, potentially less competitive in international markets,
and this would decrease our international sales. Our ability to expand
international sales depends on our ability to expand our international
operations, including establishing manufacturing assembly capabilities overseas,
hire international personnel and recruit additional international resellers. To
the extent we are unable to do so in a timely manner, our growth, if any, in
international sales will be limited and our business could be seriously harmed.
In addition, if we fail to expand and improve our worldwide operating systems,
our ability to accurately forecast sales demand, manage our supply chain and
record and report financial and management information will be adversely
affected, seriously harming our business.

Undetected software or hardware errors could cause us to incur significant
warranty and repair costs and negatively impact the market acceptance of our
products.

Our products may contain undetected software or hardware errors. These errors
may cause us to incur significant warranty and repair costs, divert the
attention of our engineering personnel from our product development efforts and
cause significant customer relations problems. The occurrence of these problems
could result in the delay or loss of market acceptance of our products and would
likely seriously harm our business. All of our products operate on our
internally developed CacheOS operating system. As a result, any error in CacheOS
will affect all of our products. We have experienced minor errors in the past in
connection with new products. We expect that errors will be found from time to
time in new or enhanced products after commencement of commercial shipments.

We could be subject to product liability claims, which are time-consuming and
costly to defend.

Our customers install our Internet caching appliances directly into their
network infrastructures. Any errors, defects or other performance problems with
our Internet caching appliance products could negatively impact our customers'
internal networks, resulting in financial or other damages to our customers. Our
customers may then seek damages from us for their losses. If a claim were
brought against us, we may not have sufficient protection from statutory
limitations, or license or contract terms with our customers and any unfavorable
judicial decisions could seriously harm our business. We have not experienced
any product liability claims to date. However, a product liability claim brought
against us, even if not successful, would likely be time-consuming and costly. A
product liability claim could seriously harm our business reputation.

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CACHEFLOW INC.

Risks Associated with Potential Acquisitions

We consummated a merger with SpringBank Networks in June 2000. If we fail to
develop and integrate SpringBank Networks' technology into our products and
services, our quarterly and annual operating results may be adversely affected.
Other risks we may face with respect to our merger with SpringBank Networks
include the potential disruption of our ongoing business and distraction of
management; the difficulty of assimilating SpringBank Networks' personnel; and
the maintenance of uniform standards, corporate cultures, controls, procedures
and policies. Our inability to address any of these risks successfully could
harm our business.

We may make acquisitions in the future. Acquisitions of companies, products or
technologies entail numerous risks, including an inability to successfully
assimilate acquired operations and products, diversion of management's
attention, loss of key employees of acquired companies and substantial
transaction costs. Some of the products acquired may require significant
additional development before they can be marketed and may not generate revenue
at levels anticipated by us. Moreover, future acquisitions by us may result in
dilutive issuances of equity securities, the incurrence of additional debt,
large one-time write-offs and the creation of goodwill or other intangible
assets that could result in significant amortization expense. Any of these
problems or factors could seriously harm our business.

If the protection of our proprietary technology is inadequate, our competitors
may gain access to our technology, and our market share could decline.

In addition, the laws of some foreign countries do not protect our proprietary
rights to as great an extent as do the laws of the United States. Our means of
protecting our proprietary rights may not be adequate and our competitors may
independently develop similar technology, duplicate our products or design
around patents that may be issued to us or our other intellectual property.

We presently have several pending United States patent applications and several
pending patent applications in foreign patent offices. Although we have not been
issued any patents to date, one patent application pending before the United
States Patent Office has been allowed and is expected to issue as a United
States patent.

We cannot assure you that any U.S. or international patent will be issued from
these applications. Even if patents are issued, we cannot assure you that we
will be able to detect any infringement or, if infringement is detected, that
patents issued will be enforceable or that any damages awarded to us will be
sufficient to adequately compensate us.

We rely on technology that we license from third parties, including software
that is integrated with internally developed software and used in CacheOS to
perform key functions. For example, we license subscription filtering technology
from Secure Computing. If we are unable to continue to license any of this
software on commercially reasonable terms, we will face delays in releases of
our software or will be required to drop this functionality from our software
until equivalent technology can be identified, licensed

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CACHEFLOW INC.

or developed, and integrated into our current product. Any of these delays could
seriously harm our business.

There has been a substantial amount of litigation in the technology industry
regarding intellectual property rights. It is possible that in the future third
parties may claim that we or our current or potential future products infringe
their intellectual property. We expect that companies in the Internet and
networking industries will increasingly be subject to infringement claims as the
number of products and competitors in our industry segment grows and the
functionality of products in different industry segments overlaps. Any claims,
with or without merit, could be time-consuming, result in costly litigation,
cause product shipment delays or require us to enter into royalty or licensing
agreements. Royalty or licensing agreements, if required, may not be available
on terms acceptable to us or at all, which could seriously harm our business.

If we are unable to raise additional capital, our ability to effectively manage
our growth or enhance our products could be harmed.

At July 31, 2000, we had approximately $84.3 million in cash and cash
equivalents and $27.3 million in short-term investments. We believe that these
amounts will enable us to meet our capital requirements for at least the next
twelve months. However, if cash is used for acquisitions or other unanticipated
uses, we may need additional capital. The development and marketing of new
products and the expansion of indirect channels and associated support personnel
will require a significant commitment of resources. In addition, if the market
for Internet caching appliances develops at a slower pace than anticipated or if
we fail to establish significant market share and achieve a meaningful level of
sales, we could be required to raise substantial additional capital. We cannot
be certain that additional capital will be available to us on favorable terms,
or at all. If we were unable to raise additional capital when we require it, our
business would be seriously harmed.

Risks Related to the Internet Caching Appliance Industry

The market for Internet caching appliances is new and unpredictable, and if this
market does not develop as we anticipate, our sales may not grow.

Sales of our products depend on increased demand for Internet caching
appliances. The market for Internet caching appliances is a new and rapidly
evolving market. If the market for Internet caching appliances fails to grow as
we anticipate, or grows more slowly than we anticipate, our business will be
seriously harmed. Because this market is new, we cannot predict its potential
size or future growth rate. Our ability to generate net sales in this emerging
market will depend on, among other things, our ability to:

. educate potential end users and indirect channel partners about the
benefits of Internet caching appliances;

. continue to develop our direct sales channel; and

. establish and maintain relationships with leading indirect channel
partners.

The legal environment in which we operate is uncertain and claims against us
could cause our business to suffer.

Our Internet caching appliances operate in part by storing material available on
the Internet and making this material available to end users from our appliance.
This creates the potential for claims to be made against us, either directly or
through contractual indemnification provisions with customers, for defamation,
negligence, copyright or trademark infringement, personal injury, invasion of
privacy or other legal theories based on the nature, content or copying of these
materials. It is also possible that if any information provided through any of
our products contains errors, third parties could make claims against us for
losses

18
<PAGE>
CACHEFLOW INC.

incurred in reliance on this information. Our insurance may not cover potential
claims of this type or be adequate to protect us from all liability that may be
imposed.

The adoption of laws that impose taxes on Internet commerce could adversely
affect our business.

Tax authorities at the international, federal, state and local levels are
currently reviewing the appropriate tax treatment of companies engaged in
Internet commerce. Many of our customers are engaged in Internet commerce, and
any taxes imposed on them may adversely impact their businesses and may result
in order cancellations or postponements of product purchases by them, which
would seriously harm our business. Laws regarding the Internet remain largely
unsettled and the adoption or modification of laws or regulations relating to
the Internet, or interpretations of existing law, could seriously harm our
business.

Because the sales of our products are dependent on the increased use and
widespread adoption of the Internet, if use of the Internet does not develop as
we anticipate, our sales may not grow.

Sales of our products depend on the increased use and widespread adoption of the
Internet. Our business would be seriously harmed if the use of the Internet does
not increase as anticipated or if our ISP customers' Internet-related services
are not well received by the marketplace. The acceptance and use of the Internet
in international markets, where we derive a large portion of our net sales, are
in earlier stages of development than in the United States. If the Internet
fails to gain sufficient acceptance in international markets, our business could
be seriously harmed. The resolution of various issues concerning the Internet
will likely affect the use and adoption of the Internet. These issues include
security, reliability, capacity, congestion, cost, ease of access and quality of
service. For example, recently certain popular websites experienced denial-of-
service attacks, which called into question the ability of these and other
websites to ensure the security and reliability of their on-line businesses.
Even if these issues are resolved, if the market for Internet-related products
and services fails to develop, or develops at a slower pace than anticipated,
our business would be seriously harmed.

Governmental regulation of the communications industry may negatively affect our
customers and result in decreased demand for our products, which would cause a
decline in our sales.

The jurisdiction of the Federal Communications Commission, or FCC, extends to
the communications industry, to our customers and to the products that our
customers sell. Future regulations set forth by the FCC or other regulatory
bodies may adversely affect Internet-related industries. Regulation of our
customers may seriously harm our business. For example, FCC regulatory policies
that affect the availability of data and Internet services may impede our
customers' penetration into some markets. In addition, international regulatory
bodies are beginning to adopt standards for the communications industry. The
delays that these governmental processes entail may cause order cancellations or
postponements of product purchases by our customers, which would seriously harm
our business.

Risks Related to Securities Markets

Our stock price is volatile and, as a result, you may have difficulty evaluating
the value of our stock, and the market price of our stock may decline.

Since our initial public offering in November 1999, the market price of our
common stock has fluctuated significantly. The market price of the common stock
may fluctuate significantly in response to the following factors:

. variations in our quarterly operating results;

. changes in financial estimates or investment recommendations by
securities analysts;

. changes in market valuations of Internet-related and networking
companies;

19
<PAGE>

CACHEFLOW INC.

. announcements by us or our competitors of significant contracts,
acquisitions, strategic partnerships, joint ventures or capital
commitments;

. loss of a major customer;

. additions or departures of key personnel; and

. fluctuations in stock market prices and volumes.

Our stock price volatility may make us susceptible to class action litigation,
which is time-consuming and costly to defend.

In the past, securities class action litigation has often been brought against a
company following periods of volatility in the market price of the company's
securities. We may in the future be the target of similar litigation. If we
become engaged in securities class action litigation, our management's attention
and resources may be diverted and we may incur substantial costs, resulting in
serious harm to our business.

20
<PAGE>

REGISTERED STOCKHOLDER

The Reoffer Prospectus relates to shares of Common Stock which have been
acquired by certain shareholders and donees who received shares from key
employees (the "Registered Stockholders"). The Registered Stockholders acquired
shares of Common Stock to be offered hereunder pursuant to the exercise of
options granted under the SpringBank Networks, Inc. 2000 Stock Incentive Plan or
pursuant to restricted stock purchase agreements entered into on January 2,
2000.

The following table sets forth certain information with respect to the
Registered Stockholders as of June 30, 2000:

<TABLE>
<CAPTION>
Number of Number of
Number of Shares to be Shares
Registered Stockholder's Position with Shares Owned Offered Owned After
Stockholder Company Before Offering Hereby Offering*
---------------------------- ---------------------------- --------------- ------------ -----------
<S> <C> <C> <C> <C>
Certain unnamed Individuals 2,507,700 1,580,429 927,271
(1)

___________________________________________________________________________________________________________________________
</TABLE>

* Assumes sale of all of the shares offered; however, the Registered
Stockholders may or may not sell all or any of the offered shares.

PLAN OF DISTRIBUTION

The shares of Common Stock covered by this Reoffer Prospectus are
being registered by the Company for the account of the Registered Stockholders.

The Registered Stockholders may sell the shares in one or more
transactions (which may involve one or more block transactions) on the Nasdaq
National Market, in sales occurring in the public market off such system, in
privately negotiated transactions or in a combination of such transactions. Each
such sale may be made either at market prices prevailing at the time of such
sale or at negotiated prices. The Registered Stockholders may sell some or all
of the shares in transactions involving broker-dealers, who may act as agent or
acquire the shares as principal. Any broker-dealer participating in such
transactions as agent may receive commissions from the Registered Stockholders
(and, if they act as agent for the purchaser of such shares, from such
purchaser). The Registered Stockholders will pay usual and customary brokerage
fees. Broker-dealers may agree with the Registered Stockholders to sell a
specified number of shares at a stipulated price per share and, to the extent
such a broker-dealer is unable to do so acting as agent for the Registered
Stockholders, to purchase as principals any unsold shares at the price required
to fulfill the respective broker-dealer's commitment to the Registered
Stockholders. Broker-dealers who acquire shares as principals may thereafter
resell such shares from time to time in transactions (which may involve cross
and block transactions and which may involve sales to and through other broker-
dealers, including transactions of the nature described above) in the over-the-
counter market, negotiated transactions or otherwise, at market prices
prevailing at the time of sale or at negotiated prices, and in connection with
such resales may pay to or receive from the purchasers of such shares
commissions.

To the knowledge of the Company, there is currently no agreement with
any broker or dealer respecting the sale of the shares offered hereby. Upon the
sale of any such shares, the Registered Stockholders or anyone effecting sales
on behalf of the Registered Stockholders may be deemed an underwriter, as that
term is defined under the Securities Act of 1933, as amended. The Company will
pay all expenses of preparing and reproducing this Reoffer Prospectus, but will
not receive the proceeds from sales by the Registered Stockholders. Sales will
be made at prices prevailing at the time of such sales.

The Company is bearing all costs relating to the registration of the
shares. Any commissions or other fees payable to broker-dealers in connection
with any sale of the shares will be borne by the Registered Stockholders or
other party selling such shares. In order to comply with certain states'
securities laws, if applicable, the shares will be sold in such jurisdictions
only through registered or licensed brokers or dealers. In certain states the
shares may not be sold unless the shares have been registered or qualified for
sale in such state, or unless an exemption form registration or qualification is
available and is obtained.

21
<PAGE>

USE OF PROCEEDS

The Company will not receive any of the proceeds from the offering
hereunder. All expenses of registration incurred in connection with this
offering are being borne by the Company, but all selling and other expenses
incurred by the Registered Stockholders will be borne by such Registered
Stockholders.

DOCUMENTS INCORPORATED BY REFERENCE

Cacheflow Inc. (the "Company") hereby incorporates by reference into this
Registration Statement the following documents previously filed with the
Securities and Exchange Commission (the "SEC"):

(a) The Registrant's Annual Report on Form 10-K filed with the SEC for the
fiscal year ended April 30, 2000; and

(b) The description of the Registrant's outstanding Common Stock contained
in the Registrant's Registration Statement No. 000-28139 on Form 8-
A12G filed with the SEC on November 16, 1999, pursuant to Section 12
of the 1934 Act, including any amendment or report filed for the
purpose of updating such description.

All reports and definitive proxy or information statements filed pursuant
to Section 13(a), 13(c), 14 or 15(d) of the 1934 Act after the date of this
Registration Statement and prior to the filing of a post-effective amendment
which indicates that all securities offered hereby have been sold or which
deregisters all securities then remaining unsold shall be deemed to be
incorporated by reference into this Registration Statement and to be a part
hereof from the date of filing of such documents.

INDEMNIFICATION

Section 145 of the Delaware General Corporation Law authorizes a court to
award or a corporation's Board of Directors to grant indemnification to
directors and officers in terms sufficiently broad to permit such
indemnification under certain circumstances for liabilities (including
reimbursement for expenses incurred) arising under the 1933 Act. The
Registrant's Bylaws provide for mandatory indemnification of its directors and
permissible indemnification of officers, employees and other agents to the
maximum extent permitted by the Delaware General Corporation Law. The
Registrant's Certificate of Incorporation provides that, pursuant to Delaware
law, its directors shall not be liable for monetary damages for breach of their
fiduciary duty as directors to the Registrant and its stockholders. This
provision in the Certificate of Incorporation does not eliminate the fiduciary
duty of the directors, and, in appropriate circumstances, equitable remedies
such as injunctive or other forms of non-monetary relief will remain available
under Delaware law. In addition, each director will continue to be subject to
liability for breach of the director's duty of loyalty to the Registrant for
acts or omissions not in good faith or involving intentional misconduct, for
knowing violations of law, for actions leading to improper personal benefit to
the director and for payment of dividends or approval of stock repurchases or
redemptions that are unlawful under Delaware law. The provision also does not
affect a director's responsibilities under any other law, such as the federal
securities laws or state or federal environmental laws. The Registrant has
entered into Indemnification Agreements with its directors. The Indemnification
Agreements provide the Registrant's directors with further indemnification to
the maximum extent permitted by the Delaware General Corporation Law.

22
<PAGE>

PART II

Information Required in the Registration Statement

Item 4. Incorporation of Documents by Reference
---------------------------------------

CacheFlow Inc. (the "Registrant") hereby incorporates by reference
into this Registration Statement the following documents previously filed with
the Securities and Exchange Commission (the "SEC"):

(a) The Registrant's Annual Report on Form 10-K filed with the SEC
for the fiscal year ended April 30, 2000; and

(b) The description of the Registrant's outstanding Common Stock
contained in the Registrant's Registration Statement No. 000-
28139 on Form 8-A12G filed with the SEC on November 16, 1999,
pursuant to Section 12 of the 1934 Act, including any amendment
or report filed for the purpose of updating such description.

All reports and definitive proxy or information statements filed
pursuant to Section 13(a), 13(c), 14 or 15(d) of the 1934 Act after the date of
this Registration Statement and prior to the filing of a post-effective
amendment which indicates that all securities offered hereby have been sold or
which deregisters all securities then remaining unsold shall be deemed to be
incorporated by reference into this Registration Statement and to be a part
hereof from the date of filing of such documents.

Item 5. Description of Securities
-------------------------

Not Applicable.

Item 6. Interests of Named Experts and Counsel
--------------------------------------

Not Applicable.

Item 7. Indemnification of Directors and Officers
-----------------------------------------

Section 145 of the Delaware General Corporation Law authorizes a court
to award or a corporation's Board of Directors to grant indemnification to
directors and officers in terms sufficiently broad to permit such
indemnification under certain circumstances for liabilities (including
reimbursement for expenses incurred) arising under the 1933 Act. The
Registrant's Bylaws provide for mandatory indemnification of its directors and
permissible indemnification of officers, employees and other agents to the
maximum extent permitted by the Delaware General Corporation Law. The
Registrant's Certificate of Incorporation provides that, pursuant to Delaware
law, its directors shall not be liable for monetary damages for breach of their
fiduciary duty as directors to the Registrant and its stockholders. This
provision in the Certificate of Incorporation does not eliminate the fiduciary
duty of the directors, and, in appropriate circumstances, equitable remedies
such as injunctive or other forms of non-monetary relief will remain available
under Delaware law. In addition, each director will continue to be subject to
liability for breach of the director's duty of loyalty to the Registrant for
acts or omissions not in good faith or involving intentional misconduct, for
knowing violations of law, for actions leading to improper personal benefit to
the director and for payment of dividends or approval of stock repurchases or
redemptions that are unlawful under Delaware law. The provision also does not
affect a director's responsibilities under any other law, such as the federal
securities laws or state or federal environmental laws. The Registrant has
entered into Indemnification Agreements with its directors. The Indemnification
Agreements provide the Registrant's directors with further indemnification to
the maximum extent permitted by the Delaware General Corporation Law.

II-1
<PAGE>

Item 8. Exemption from Registration Claimed
-----------------------------------

The sale and issuance of securities to the registered stockholders by
CacheFlow Inc. to whom the shares offered for resale pursuant to this
Registration Statement were sold were in each case deemed to be exempt from
registration under the Securities Act of 1933 by virtue of Section 4(2) thereof.

Item 9. Exhibits
--------

Exhibit Number Exhibit
-------------- -------

4 Instrument Defining Rights of Stockholders. Reference is made
to Registrant's Registration Statement No. 000-28139 on Form 8-
A12G, which is incorporated herein by reference pursuant to
Item 3(d) of this Registration Statement.
5 Opinion and consent of Gunderson Dettmer Stough Villeneuve
Franklin & Hachigian, LLP.
23.1 Consent of Ernst & Young LLP, Independent Auditors.
23.2 Consent of Gunderson Dettmer Stough Villeneuve Franklin &
Hachigian, LLP is contained in Exhibit 5.
24 Power of Attorney. Reference is made to page II-3 of this
Registration Statement.
99.1 Form of Written Compensatory Agreement (Founder's Stock
Purchase Agreement).
99.2 Form of Written Compensatory Agreement (Stock Option
Agreement).

Item 10. Undertakings
------------

A. The undersigned Registrant hereby undertakes: (1) to file, during
any period in which offers or sales are being made, a post-effective amendment
to this Registration Statement (i) to include any prospectus required by Section
10(a)(3) of the 1933 Act, (ii) to reflect in the prospectus any facts or events
arising after the effective date of this Registration Statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in this
Registration Statement and (iii) to include any material information with
respect to the plan of distribution not previously disclosed in this
Registration Statement or any material change to such information in this
Registration Statement; provided, however, that clauses (1)(i) and (1)(ii) shall
--------
not apply if the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed with or
furnished to the SEC by the Registrant pursuant to Section 13 or Section 15(d)
of the 1934 Act that are incorporated by reference in this Registration
Statement; (2) that for the purpose of determining any liability under the 1933
Act each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof and (3) to remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the SpringBank Networks, Inc. 2000 Stock Incentive Plan and the
Written Compensatory Agreements.

B. The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the 1933 Act, each filing of the Registrant's
annual report pursuant to Section 13(a) or Section 15(d) of the 1934 Act that is
incorporated by reference in this Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.

C. Insofar as indemnification for liabilities arising under the 1933
Act may be permitted to directors, officers or controlling persons of the
Registrant pursuant to the indemnification provisions summarized in Item 6 or
otherwise, the Registrant has been advised that, in the opinion of the SEC, such
indemnification is against public policy as expressed in the 1933 Act, and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the 1933 Act and will be governed by the final
adjudication of such issue.

II-2
<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as
amended, the Registrant certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Sunnyvale, State of California on this 7th day
of September, 2000.

CACHEFLOW INC.

By: /s/ Brian M. NeSmith
-----------------------------------------
Brian M. NeSmith
Chief Executive Officer, President, and
Director

POWER OF ATTORNEY
-----------------

KNOW ALL PERSONS BY THESE PRESENTS:

That the undersigned officers and directors of Cacheflow Inc., a
Delaware corporation, do hereby constitute and appoint Brian M. NeSmith and
Michael A. Johnson, and either of them, the lawful attorneys-in-fact and agents
with full power and authority to do any and all acts and things and to execute
any and all instruments which said attorneys and agents, and either one of them,
determine may be necessary or advisable or required to enable said corporation
to comply with the Securities Act of 1933, as amended, and any rules or
regulations or requirements of the Securities and Exchange Commission in
connection with this Registration Statement. Without limiting the generality of
the foregoing power and authority, the powers granted include the power and
authority to sign the names of the undersigned officers and directors in the
capacities indicated below to this Registration Statement, to any and all
amendments, both pre-effective and post-effective, and supplements to this
Registration Statement, and to any and all instruments or documents filed as
part of or in conjunction with this Registration Statement or amendments or
supplements thereof, and each of the undersigned hereby ratifies and confirms
all that said attorneys and agents, or either one of them, shall do or cause to
be done by virtue hereof. This Power of Attorney may be signed in several
counterparts.

IN WITNESS WHEREOF, each of the undersigned has executed this Power of
Attorney as of the date indicated.

Pursuant to the requirements of the Securities Act of 1933, as
amended, this Registration Statement has been signed below by the following
persons in the capacities and on the dates indicated.

<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Brian M. NeSmith
------------------------------------------ Chief Executive Officer, President, and Director September 7, 2000
Brian M. NeSmith (Principal Executive Officer)

/s/ Michael A. Johnson
------------------------------------------ Chief Financial Officer, Vice President, and Secretary September 7, 2000
Michael A. Johnson (Principal Financial and Accounting Officer)
</TABLE>

II-3
<PAGE>

Signature Title Date
--------- ----- ----

_______________________ Director
Marc Andreessen

/s/ David W. Hanna Director September 7, 2000
-----------------------
David W. Hanna

Director
-----------------------
Michael A. Malcolm

/s/ Stuart G. Phillips Director September 7, 2000
-----------------------
Stuart G. Phillips

/s/ Andrew Rachleff Director September 7, 2000
-----------------------
Andrew Rachleff

II-4
<PAGE>

EXHIBIT INDEX

Exhibit Number Exhibit
-------------- -------
4 Instrument Defining Rights of Stockholders. Reference is
made to CacheFlow Inc.'s Registration Statement No. 0-
28139 on Form 8-A, which is incorporated herein by
reference under Item 3(b) of this Registration Statement.
5 Opinion and consent of Gunderson Dettmer Stough Villeneuve
Franklin & Hachigian LLP.
23.1 Consent of Ernst & Young LLP, Independent Auditors.
23.2 Consent of Gunderson Dettmer Stough Villeneuve Franklin &
Hachigian LLP is contained in Exhibit 5.
24 Power of Attorney. Reference is made to page II-3 of this
Registration Statement.
99.1 Form of Written Compensatory Agreement (Founder's Stock
Purchase Agreement).
99.2 Form of Written Compensatory Agreement (Stock Option
Agreement).