Cambridge Technology Group Telematics Subsidiary Receives $8 Million in New Funding; VCommand's AvStar Product Scheduled for Launch in 4Q 2001.

Business Editors

MCLEAN, Va.--(BUSINESS WIRE)--Oct. 2, 2001

Cambridge Technology Group has announced that its subsidiary, VCommand, has received $8 million in a $14 million round of funding as it proceeds towards the launch of its AvStar telematics product.

VCommand is focused on the development of next-generation telematics applications for the automotive industry. This brings to $30 million the amount that has been invested in the research and development of the AvStar product. This latest round of investment will facilitate the production and rollout of the next-generation AvStar product later this fall.

AvStar is a fully hands-free/eyes-free voice interactive automobile navigation system. Ultimately, AvStar will allow for access to multiple services and applications in a mobile environment, including email access, wireless phone, entertainment such as MP3 and interactive games, and customized content such as real-time traffic updates.

It is fully functional in the U.S. and France, with the U.K. and Germany in the final stages of language integration. AvStar can be used in a variety of mobile environments, including automobile, commercial fleet/delivery, leisure/recreation and maritime applications.

AvStar was debuted at the prestigious Mondial Auto Show in September 2000, where it received critical acclaim for its functionality, advanced voice recognition capability and competitive cost. AvStar fills a need within the automotive industry to balance the desire of consumers to have access to advanced services in a mobile environment, while not compromising safety and driver attention to the road.

"AvStar's competitive edge is lower price and proven technology, combined with an advanced voice-recognition capability," says Bob O. Evans, Chairman of Cambridge Technology Group. "It addresses the dual needs of increasing productivity in a mobile environment while maintaining a safer alternative to display-based mobile computing applications."

Mr. Evans is a pioneer in the computing field, and is a recipient of the National Medal of Technology. Mr. Evans held a series of senior leadership positions during a 33-year career with IBM, and was the founder of the IBM System 360.

The first generation of AvStar was originally brought to market as a voice-response navigation system in controlled consumer trials in 1996. Cambridge Technology Group acquired the rights to the Interactive Voice Systems (IVS) intellectual property in 1999, and created VCommand to begin development of the next-generation AvStar platform.

"VCommand's development of advanced telematics has been supported by world-class leaders in the automotive and consumer electronics sectors," reports Andrew Carrington, Cambridge President and CEO. "As a result of these strategic partnerships, AvStar is now positioned to provide the basis for an integrated applications and communications platform in the vehicle."

Carrington adds, "Americans spend more than 540 million hours per year in their vehicles, and only a small percentage of that time is used productively. Our goal is to provide a solution that increases productivity that directly translates into better quality of life, without sacrificing safety."

Facts Regarding Telematics

Telematics sector are expected to experience rapid growth over the next several years, and VCommand is well positioned in this market. In this sector:

-- Frost & Sullivan projects growth in telematics from $380 million in 2000 to
$7 billion for the sector by 2007;

-- The Strategis Group projects 84% of all new cars in the U.S. will be
equipped with some form of telematics by 2005, and [pilcrow (paragraph sign)]
Delphi Automotive Group projects 50% of all cars produced world-wide will have
such applications by 2006;

-- Telematics Research Associates predicts a compound annual growth rate in the
sector of 61% for each of the next five years.

VCommand's hands-free, eyes-free technology is unique among telematics solutions, and should capitalize on the trends affecting U.S. drivers, including:

-- According to the National Association of State Legislatures,

40 states are considering or have enacted legislation that

would address driver distraction from electronic devices such

as wireless phones in cars;

-- The 2000 Census found that 87.5% of U.S. workers commute in a

private vehicle, with 52.5% of drivers experiencing a commute

of 20 or more minutes.

The company intends to commence production in the 4th quarter, 2001, and will announce distribution agreements at the time of the start of production.

About Cambridge Technology Group

Founded in 1987 as Cambridge Research Associates (CRA), the company introduced advanced real-time imaging software, and later developed design tools for complex embedded systems. Cambridge Technology Group was formed in 1996 to oversee CRA and to leverage the success of the firm's research and development activities into new markets and opportunities.

Cambridge Technology Group's portfolio companies now deliver a wide range of enabling technologies for commercial and government applications. Cambridge has emerged as a premier developer and provider of these technologies in the emerging embedded systems market.

Based in McLean, Virginia, privately-held Cambridge and its subsidiaries employ more than 165 people, with offices in California, Texas and Europe.