Com21 to Acquire BitCom, Inc., Broadband Engineering Firm; New Group to Become Maryland Development Center.

Business Editors and Technology Writers

MILPITAS, Calif.--(BUSINESS WIRE)--June 26, 2000

Com21, Inc. (Nasdaq:CMTO), a leading global provider of system solutions for the broadband access market, announced today that it will acquire BitCom, Inc., a privately held engineering consulting firm in Germantown, Maryland, for $4 million in cash.

In addition, Com21 has allotted 395,000 shares of Com21 common stock for assumed BitCom stock options and contingent stock grants for current BitCom employees. The acquisition, which is expected to be effective July 6, 2000, will be accounted for using purchase accounting. BitCom, which specializes in wireless, satellite, and networking engineering, will become Com21's Maryland Development Center.

"The acquisition of BitCom provides us with a high quality engineering team with a proven track record," remarked Ron Foster, chief operating officer of Com21. "Com21 engineering teams have been the key to our success, both here in the United States and in Europe, and we expect that the Maryland Development Center will become one more link in that strong technology chain."

Mohammad Soleimani, BitCom's founder and president, agreed. "It is a pleasure to join Com21," said Soleimani. "Their focus on quality engineering and commitment to the various product lines and industry standards fit well with BitCom's expertise and vision. We look forward to making a strong contribution to the continued success of Com21."

Soleimani will become director of the Maryland Development Center, and will report to Paul Gordon, vice president of Engineering for Com21.

With the pending acquisition of BitCom and the previously announced GADline (Jerusalem, Israel) acquisition, Com21 continues to strengthen its worldwide technology capabilities in the broadband access market by developing regional centers of competence. In addition to the central product development group in Milpitas, California, Com21 maintains its European Development Centre (Cork, Ireland) which focuses on DVB products. Upon the completion of the GADline acquisition, the Israeli group will focus on Com21's telephony-over-cable products. Com21 will use the BitCom acquisition to create the Maryland Development Center, which will initially focus on Com21's ATM-based ComUNITY(TM) Access System, an end-to-end broadband access system including headend and cable modem equipment and network management software.

"There are various broadband standards throughout the world," noted Foster. "Com21 intends to remain a leader in all standards environments, and our commitment to our ATM-based ComUNITY Access System customers is greatly enhanced with this acquisition."

About Com21, Inc.

Com21, Inc. is a leading global supplier of system solutions for the broadband access market. The Company's DOCSIS, DVB, and ATM-based products enable cable operators and service providers to deliver high-speed, cost-effective Internet and telephony applications to corporate telecommuters, small businesses, home offices, and residential users. To date, Com21 has shipped over a half million cable modems worldwide, along with nearly one thousand headend controllers. Com21 systems offer commercial service in cable systems passing 15 million households worldwide.

Com21 is an ISO 9001 registered company with over 260 employees in 13 countries. The Company's corporate headquarters is located in Milpitas, California, USA, with its European headquarters in Delft, The Netherlands. In addition, Com21 maintains a European Development Centre in Cork, Ireland, as well as sales and support offices in the United States and Canada, Europe, Asia, and Latin America.

About BitCom, Inc.

BitCom, Inc., a Delaware company with facilities in the state of Maryland, specializes in turnkey development of networking and consumer electronic equipment. Founded in 1997, BitCom has grown through performing contract engineering for leading communication equipment vendors designing carrier class and high volume equipment for both TDM and packet-based systems.

Safe Harbor Act Clause

This press release contains forward-looking information within the meaning of Section 27A of the Securities Act of 1933 and Section21E of the Securities Exchange Act of 1934, and is subject to the safe harbors created by those sections. This press release contains forward-looking statements related to Com21's acquisition of BitCom. Actual results may differ materially due to a number of factors, including Com21's ability to integrate BitCom with existing business. The matters discussed in this press release may also involve risks and uncertainties concerning Com21's products and services described in Com21's filings with the Securities and Exchange Commission (SEC). In particular, see the risk factors described in the Company's most recent Form 10K and Form 10Q. Com21 assumes no obligation to update the forward-looking information contained in this press release.

Com21(R)is a registered trademark of Com21, Inc., Milpitas, California, U.S.A. All other trademarks are the property of their respective owners.