Compaq And Cisco Extend Strategic Partnership To Joint Sales And Marketing; Agreement Provides For Joint Marketing, Sales And Promotional Activities To Develop Market For Industry-Standard Platforms Hosting Cisco IOS Software Technology.

HOUSTON and SAN JOSE, Calif.--(BUSINESS WIRE)--July 29, 1996--Compaq Computer Corporation (NYSE:CPQ) and Cisco Systems Incorporated (NASDAQ:CSCO) today announced that they have entered into a multi-year, worldwide agreement to develop the market for industry-standard networking platforms using Cisco IOS software technology. This agreement extends the existing Compaq and Cisco strategic partnership, announced last year, to joint sales and marketing activities. These joint activities are targeted at expanding demand for networking products and complete client/server network solutions for small and mid-sized businesses, branch offices and workgroups.

"Compaq has a high level of success at leveraging marketing partnerships to provide powerful and integrated solutions to its customers," said Doug Pushard, vice president, Networking Products Division, Compaq Computer Corporation. "This agreement with Cisco will give Compaq direct access to the industry's premier source of internetworking expertise and this will enable wider availability of the benefits of Cisco IOS software technology through Compaq's extensive distribution partners."

As part of the new agreement, Compaq and Cisco will jointly participate in market development activities such as joint seminars, promotions, and growth and competitive replacement programs in target markets. In addition, the companies will recruit and train resellers, and will train each other's field sales and engineering organizations on their respective products. Both companies will continue to independently sell and support their own products, and will jointly support the sales of internetworking products through existing Compaq distribution channels.

"Cisco believes that Compaq embodies a major win in our strategy to make Cisco IOS software technology the industry-standard for internetworking," said Selby Wellman, Senior Vice President, Business Units, Cisco Systems. "With this agreement, both companies can expand their customer solutions and market presence beyond what either of us could achieve on our own."

The companies also expect to extend their partnership into other product and sales opportunities that will meet their mutual goals of networking market expansion.

"In order to be successful in this fast growing networking market, vendors need a unique and powerful assembly of industry-leading technologies to provide integrated solutions to real-world problems. The solutions have to be cost effective and widely available," said Richard Chernick, President of Connecting Point, a reseller located in Green Bay, Wisconsin. "By joining forces, Compaq Computer and Cisco Systems, are uniquely positioned to fulfill these requirements." Compaq and Cisco signed a joint development agreement last year to integrate Cisco IOS software technology features into an industry-standard platform to be sold by Compaq under its Netelligent brand. The new routing platform is currently installed in multiple beta sites. Product information and reseller locations for Compaq Netelligent products can be obtained by calling 1-800-544-5255.

Company Background

Compaq Computer Corporation, a Fortune 100 company and the world's largest supplier of personal computers, delivers useful innovation through products that network people with information. Compaq is strategically organized to meet the current and future needs of its customers, offering enterprise computing solutions, networking products, commercial PC products and consumer PCs. In 1995, the company reported worldwide sales of $14.8 billion. The company is an industry leader in environmentally friendly programs and business practices. Compaq products are sold and supported in more than 100 countries through a network of authorized Compaq marketing partners. Customer support and information about Compaq and its products can be found at http://www.compaq.com or by calling 1-800-OK-COMPAQ. Product information and reseller locations can be obtained by calling 1-800-345-1518.

Cisco Systems Inc. is the leading global supplier of internetworking solutions for corporate intranets and the global Internet. Cisco's products, including routers, LAN and WAN switches, dial-up access servers and network management software, are integrated by the Cisco IOS software to link geographically dispersed LANs, WAN and IBM networks. Company news and product and service information are available at World Wide Web site http://www.cisco.com. Cisco is headquartered in San Jose, CA. -0-

Compaq, Registered U.S. Patent and Trademark Office. Netelligent is a trademark of Compaq Computer Corporation. Cisco Systems and Cisco IOS are trademarks of Cisco Systems, Inc. Product names mentioned herein may be trademarks and/or registered trademarks of their respective companies

CONTACT: Compaq Computer Corporation

Dave Anderson

713-514-0484

[e-mail]

or

Miller/Shandwick Technologies

Eric Grodziski

617-536-0470

[e-mail]

or

Cisco Systems, Inc.

Robert Michelet

408-526-6636

[e-mail]