CTC Communications Announces Selection of Cisco Systems, Inc. As Its Primary Network Supplier for Its Data-Centric Network.

WALTHAM, Mass.--(BUSINESS WIRE)--Sept. 22, 1998--CTC Communications Corp. (NASDAQ:CPTL) announced today that it has entered into a master equipment purchase agreement with Cisco Systems, Inc. to supply the primary network components of CTC's data-centric Integrated Communications Network. Under the terms of the agreement, CTC has agreed to a three year, $25 million volume purchase commitment for Cisco equipment and services. In addition, Cisco has also entered into a letter of intent with CTC for a three year $25 million vendor financing facility. The consummation of the vendor financing facility is subject to negotiating definitive documentation.

CTC intends to make an initial purchase order under this master equipment purchase agreement in the near future. The initial purchase order will be for approximately $7.5 million of equipment and services and will enable CTC to install the first 21 of its network hub and node sites in its existing markets within the New England and New York regions. The Company plans to purchase additional equipment from Cisco as it further expands into the New England and Mid Atlantic regions.

CTC is building an advanced Asynchronous Transfer Mode (ATM)-based network, using Cisco BPX (R) 8600 series and Cisco MGX(TM) 8800 series IP+ATM wide-area switches, that will deliver enhanced access services such as traditional dedicated services, frame relay, IP, video, and circuit emulation transport services. Cisco's solutions enable CTC to deliver all of these services and voice across a single multiservice dedicated connection that lowers customers' telecommunications costs.

Robert Fabbricatore, Chairman and CEO of CTC Communications, commented "We are delighted to be partners with Cisco in developing our network. The Cisco solution is well suited for our data-centric network strategy and we expect that it will enable us to achieve substantial operational saving versus the traditional circuit-switched network architecture. Our plans call for installation of this equipment in the first quarter of 1999 with beta testing immediately thereafter. Under the current plan, we expect to begin transitioning customers onto our network by mid summer 1999 and, at that point in time, expect to begin realizing the margin improvements associated with on-net services."

Kevin DeNuccio, Vice President of Service Provider Operations for Cisco stated, "We are excited about this partnership with CTC. CTC's expertise in data communications and significant installed base of data products makes our networking solutions ideally tailored to their customer base. As one of the first CLECs in the country to entirely forgo circuit switching technologies in their network architecture, we think CTC is on the leading edge of the revolution in packet switching that is now taking place. We believe their data centric network strategy will be extremely cost efficient and we look forward to assisting CTC with their transition to a facilities-based CLEC."

Cisco BPX 8600 series IP+ATM switches are the first carrier-class ATM switches to deliver IP services through Tag Switching. Tag Switching represents the industry's first end-to-end implementation of the emerging Multiprotocol Label Switching (MPLS) standard, giving service providers the privacy characteristics and quality-of-service (QoS) benefits of ATM and the universal connectivity of IP. Cisco designed the MGX 8800 series wide-area edge switch to meet the needs of small to large points of presence (PoPs) or central offices (COs). A single MGX 8800 switch will scale to 1,344 DS-1 circuit connections. Multiple MGX 8800 switches can be integrated into a single managed network node that will scale to 21,504 DS-1 circuit connections.

CTC is a rapidly growing provider of integrated communications solutions to small and medium-sized business customers in the Northeastern U.S. It provides an extensive array of voice and data services including local, long distance, frame relay, Internet access, and other advanced data services. The Company markets its services through its 190 member direct sales force located in twenty branch offices throughout Massachusetts, New York, Connecticut, New Hampshire, Vermont, Rhode Island, and Maine. CTC's headquarters is in Waltham, Massachusetts and CTC can be found on the worldwide web at http://www.ctcnet.com. For an update on the current status of CTC's transition to a facilities-based CLEC, please refer to the August 10, 1998 Conference Call Notes on CTC's home page.

The statements in this press release that relate to future plans, events or performance are forward-looking statements including statements relating to planned expansion, scheduled network deployment, expected operational cost savings, capital requirements and equipment performance. All forward-looking statements involve risk and uncertainties that could cause actual results to differ materially from those reflected or implied in the forward-looking statements. Readers are, accordingly, cautioned not to place undue reliance on these forward-looking statements, which speak only as to the date hereof. Additional information about these risks and uncertainties is set forth in the Company's most recent report on Form 10-Q. CTC undertakes no obligation to release publicly the results of any revisions to these forward-looking statements that may be made to reflect results, events or circumstances after the date hereof.