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Walden International Announces Acquisition of Sonoma Systems by Nortel Networks.

San Francisco (August 18, 2000) Walden International, a leading Silicon Valley-based venture capital firm, today announced that its portfolio company Sonoma Systems Inc. has been sold to Nortel Networks Corp. (NYSE/TSE: NT) for $540 million in stock.

Sonoma Systems is a leader in delivering high-speed integrated video, data and voice communications, simultaneously over a single connection. The company's integrated access devices, which are installed at customer premises, allow service providers to efficiently and profitably extend new services to business customers, including high-speed Local Internet access, video services and Internet Telephony. The acquisition of Sonoma will enable Nortel Networks customers to offer comprehensive managed services via a network architecture that brings broadband content and high-bandwidth capabilities to the edge of the network.

Walden International takes a long-term partnership approach to its portfolio companies and has actively participated in Sonoma business development since it co-led an investment round for the company in December of 1998. Walden International's General Partner, Andrew Kau serves on Sonoma's board of directors and has counseled the company on various strategic decisions.

"We are very pleased that Sonoma has chosen to partner with the world's leading telecom network equipment supplier to accelerate the carrier-managed services market, a market which is estimated to grow to $18 billion by 2002," said Kau. "Walden International has enjoyed a long and productive relationship with Sonoma and we are glad to see them play such a critical role in the future of high-speed managed services."

The transaction, which is expected to close in the fourth quarter of 2000, is subject to customary regulatory and shareholder approvals. A portion of the sale is contingent upon Sonoma Systems achieving certain business objectives.

About Sonoma Systems

Sonoma Systems develops Carrier-Class Broadband Integrated Access Devices that allow Service Providers to deliver integrated services (Internet, voice, data and video) with Class of Service guarantees over a single, cost-effective access network. Sonoma Systems is headquartered in Marina del Rey, California with a technology center located in Marlborough, Massachusetts, and sales and support offices located throughout North America and in the UK. Additional information on products is available on the Sonoma Systems website at www.sonoma-systems.com.

About Walden International

Walden International is a leading Silicon Valley-based venture capital firm, providing early stage technology companies with the advantage of an unrivaled global network since 1987. The firm's international venture capital funds comprise more than US$1 billion in committed capital. Walden International's globally organized network of multi-cultural investment professionals spans the United States, Taiwan, Singapore, Hong Kong, Malaysia, China, the Philippines, India, Japan and Australia. For more information please visit www.waldenintl.com.