Shepardson Microsystems, Inc. (SMI) was a small company producing operating systems and programming languages for the Atari 8-bit and Apple II computer families. SMI is most noted for authoring Atari's BASIC and Disk Operating System (DOS) products.
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Shepardson Microsystems was founded by Robert Shepardson in Saratoga
Atari planned to follow up its successful Atari VCS computer game system with a more powerful home computer (The Atari 8-bit), to be introduced at the January 1979 Consumer Electronics Show. This required the development of a BASIC interpreter. Microsoft BASIC had been licensed for this purpose, but the task of retrofitting the code into an 8k cartridge proved too difficult to meet schedule. Consequently, Atari turned to Shepardson Microsystems, who proposed a new BASIC instead of using Microsoft BASIC. Atari proceeded to contract with SMI not only for Atari BASIC, but the Atari Disk Operating System (Atari DOS) itself. Development of both products were completed ahead of schedule.
In early 1981, SMI concluded that their BASIC and DOS products were not viable, and permitted them (with the Atari Assembler Editor product) to be purchased by Bill Wilkinson and Mike Peters, who formed Optimized Systems Software. The new company then proceeded to enhance the products and sell them as third-party applications.
When Shepardson Microsystems ported Basic to the Atari, their work was so quick that they had it finished before the contract was signed — and the contract had room for a $1000 penalty or bonus if the work appeared after a date in April 1979. They already had it done by the December 28, 1978 delivery of the contract.
Wilkinson, Bill (1983). The Atari BASIC Source Book. Compute! Books. ISBN 0-942386-15-9.