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Calient Networks Secures $225 Million in Third Round Financing
Proceeds to Support Production and Delivery of DiamondWave™ Photonic Switching System

San Jose, Calif., January 8, 2001 – Calient Networks, an innovator of intelligent, all-photonic switching systems, announced today that it has closed a total of $225 million in financing. BlueStream Ventures led the financing, which includes equity investments of over $195 million and lease commitments of up to $30 million. Strategic investors participating in the round included Juniper Networks, Inc., Marconi, Tellabs and ONI Systems. Also participating were a number of leading financial institutions such as Invesco, American Express Financial Corporation, J. & W. Seligman & Co., Amerindo Investment Advisors and TeleSoft Partners.

Proceeds from this round will be used to fund Calient's move into commercial release and volume production of the DiamondWave™ photonic switching system, with first deliveries scheduled for early 2001. The MEMS-based DiamondWave switch is in the midst of completing the first of three phases of interoperability testing with a range of network elements, positioning it to perform dozens of applications in service provider networks. This broad applicability is representative of Calient's "Borderless Photonics" initiative, which is strongly supported by backers in this latest round of funding.

In conjunction with this event, Scott Kriens, chief executive officer and president of Juniper Networks, will be added as the newest member of the Calient Networks board of directors. "Calient's leadership in photonic switching, and the company's commitment to multi-layer network standards holds great potential for the future cooperation of the optical and routing layers of next generation networks," said Kriens.

"The ability to secure this level of financing under current optical market conditions is directly related to the superior product technology, significant market opportunity and seasoned executive team that Calient has put in place. The early success that Calient has experienced with service providers coupled with the backing of major strategic partners is a strong signal of the company's competitive leadership and momentum for success," said Tom Erickson of BlueStream.

"Calient continues to scale capacity and resources in anticipation of the substantial market demand over the next couple of years," emphasized Charles Corbalis, Calient president and CEO. "We have been funded by an outstanding team of strategic and financial backers, each with impressive credentials. We are pleased to have gained the confidence and ongoing support of such reputable companies."

About Calient Networks

Calient Networks is a new developer of intelligent, all-photonic switching systems and software that help service providers scale their networks for explosive bandwidth demands and deliver a new generation of wavelength services. Calient's architecture and DiamondWave™ switching system will provide a seamless, ‘opto-electronic-to-photonic' migration path that is non-disruptive to legacy operations, and near-term opportunity for carriers to offer revenue-generating optical services from their photonic infrastructure. Founded in March 1999, the company is headquartered in San Jose, California. For additional information about Calient, visit www.calient.net.