Amperion Forms to Develop Medium-Voltage Powerline Communications Technologies; American Electric Power, Cisco Systems and Redleaf Group Provide First Round Funding.

Business Editors

CHELMSFORD, Mass.--(BUSINESS WIRE)--June 11, 2001

An early stage innovative new company, Amperion, Inc., has formed to focus on the development and delivery of medium-voltage powerline networking equipment. Amperion will design, develop and sell networking hardware and software that enables the delivery of high-speed broadband data over medium-voltage powerlines. First round investors in Amperion include American Electric Power, a leading energy company and one of America's largest distributors of electricity, Cisco Systems, Inc., the worldwide leader in networking for the Internet, and Redleaf Group, Inc., a leading technology operating company.

Amperion will concentrate on medium voltage PLC technologies delivering data over utilities rights of way rather than the established low voltage access or the in-premise application spaces. Amperion products will enable customers to use the existing powerline infrastructures to provide high-speed data transport, which will enable Broadband service providers to expand their offering and reach new markets in a competitive environment. Potential Amperion customers include unregulated telecom subsidiaries of power utilities ("ETCs" or Exempt Telecommunications Companies) and other types of telecommunications service providers (CLECs, wireless providers, etc.).

"We are pleased to be working closely with Cisco, Redleaf, and Amperion to accelerate the development of medium-voltage powerline technologies," said Pete Thomas, Vice President of AEP Communications, the telecommunications subsidiary of American Electric Power. "ETCs and other companies are investing in communications services, but the growth in these areas is hindered by the fact that existing broadband networks don't reach all customers or communities. Amperion's technology, coupled with its strategic business and cohesive marketing approach, will expand upon the ETCs' current fiber build approach by further utilizing the energy infrastructure to push supply closer to demand."

"We are excited to be involved in this partnership that will yield cost-effective, high-speed networking technology from the existing powerline infrastructure," added David Diamond, managing director of Redleaf's Boston office. "This venture fits squarely into Redleaf's strategy - seeking out and providing funds to leading edge innovations and potential market leaders, while accelerating time to market with our start-up operating expertise."

"The potential inherent in broadband communications is seriously restricted by its lack of universal reach. A technology that permits all communities and customers to access broadband service could revolutionize education, healthcare and most other facets of our lives," said Judith Warrick of Morgan Stanley. "Amperion is developing just such a technology -- one which sends high-speed data over medium-voltage powerlines, the type of lines used to carry electricity in cities and communities across the country. Using this technology, any area with electricity can also have broadband communications access."

Amperion's management team is led by President and Founder Philip Hunt, a recognized leader in powerline communications (PLC) for both in-premise, and access technologies. He is internationally known in the powerline communications community and the former head of the technical workgroup and a board member of the International Powerline Forum (IPF). Mr. Hunt also provided a leading role in the IPCF (later the PLCforum) and has played a critical founding role in the HomePlug Alliance, a low voltage in-premise, powerline networking initiative backed by several leading networking equipment companies. "Amperion is `last-mile agnostic,' meaning that Amperion will interconnect high-speed data delivered on the power lines to any technology such as low voltage PLC, DSL, and wireless, that carries the data into customers' homes or businesses," Hunt said. "Other announced efforts in medium voltage PLC have missed one or another essential ingredient. This time, the market opportunity, the people involved, the business orientation and the technology are all coming together as never before."

For additional information see www.amperion.com

About Redleaf Group

Redleaf Group, Inc. (www.redleaf.com) is a technology operating company that provides services and capital for pre-seed and seed-stage technology companies. Leveraging a digital GRID - our global network of people and resources - Redleaf provides its partner companies with market access, strategic counsel and operational support from a team of seasoned professional managers whose specialties include finance, engineering, product development, systems integration, marketing and human capital management. Redleaf is located in key NetHubs, or technology centers, throughout the United States. Expansion into Europe and Asia is underway.

Established in December 1999, Redleaf's strategic investors include Safeguard Scientifics (NYSE:SFE), Novell (Nasdaq:NOVL), VentureBank@PNC, Mellon Ventures, Inc., and Hewlett-Packard (NYSE:HWP).