Concord Communications Secures Additional Financing; New Products and Partnerships Position Company for Success in Burgeoning Network Management Tools Market.

MARLBORO, Mass.--(BUSINESS WIRE)--Jan. 15, 1996--Concord Communications, a leading supplier of automated network and reporting analysis tools, announced today that it has obtained $4.5 million in a third-round financing. The additional capital will be used for product development and for expanding the company's sales and marketing infrastructure.

A new investor in Concord, Charles River Ventures led the third-round financing. Other investors include Apex Investment Partners; Battery Ventures, Bay Partners; Boston University Community Development Fund; Canaan Partners; Hancock Venture Partners; the Massachusetts Technology Development Corporation; and Pioneer Capital. Concord previously raised $5 million in December 1993.

"This financing is a very significant step in the development of our company," said Jack Blaeser, president and chief executive officer of Concord Communications. "During the past year, we successfully repositioned Concord from a supplier of hardware-based monitoring and analysis products into a software company delivering fully automated network performance reporting tools. Enthusiastic feedback from our customers, partners, and industry experts has validated that we are moving in the right direction. This financing will allow us to continue developing our products as well as enhance our ability to promote and deliver them to the marketplace."

According to industry analyst Jill Huntington-Lee of Datapro Information Services in Delran, New Jersey, "1996 promises to be a banner year for network management services and value-added network tools like Concord's Network Health. As organizations continue to invest in network infrastructure in order to gain a competitive business advantage, there is an increasing amount of pressure placed on network managers to improve network performance and measure return on investments. In the past, network managers lacked the tools required to do this easily and were forced to spend countless hours sifting through mountains of data to make sense of it. Concord's Network Health represents a whole new generation of network management tools that will help liberate network managers from this drudgery and will allow them to focus on meeting business objectives."

Fortune 500 companies utilize Concord Communication's Network Health automated reporting and analysis tools to assess the health of their network on a daily basis. Network Health's targeted views of the network allow organizations to optimize network performance, execute capacity planning, better manage service level agreements, and achieve a better return on investment on networked resources. In a competitive environment where most network managers are directed to do more with less, Network Health provides the right network information at the right time and in the right format.

Since Network Health began shipping in March 1995, Concord has experienced exponential growth in subsequent consecutive quarters. The company expects to sustain this high level of growth in 1996.

Internetworking industry leaders, such as Bay Networks, have also recognized Concord's leadership in automated performance reporting. Concord and Bay Networks recently completed a cooperative development and marketing agreement. Under the partnership, the two companies will integrate Network Health's automated reporting capabilities with the RMON/RMON2 (remote monitoring) functionality of Bay Networks' Advanced Analyzer product. Concord also has partnerships with Cabletron Systems, Computer Associates, Hewlett-Packard, Oracle, and Sun Microsystems.

"This financing afforded an excellent opportunity to invest in a company poised for growth in a market that is on the verge of exploding," said Richard Burnes, general partner of Charles River Ventures. "The management team has done a superb job of refocusing the company's development efforts to bring forth exciting new products that leverage Concord's unique technology."

"Concord Communications is a company on the move," said Robert Wadsworth at Hancock Venture Partners. "The company is establishing meaningful partnerships with the internetworking industry leaders and has penetrated major accounts like Chevron, Bear Stearns, NYNEX, and Pepsi. As these large organizations, who are typically the early adopters of new technologies and tools, scale up their deployments of Network Health, Concord can look forward to a significant increase in market opportunities."

Founded in 1992 as supplier of automated network reporting and analysis tools, Concord Communications provides customers with the information they need to effectively plan and manage the growth of their enterprise networks. Fortune 500 companies turn to Concord each morning to assess the health of their enterprise-wide networks. Concord is a privately held company with headquarters in Marlboro, Massachusetts. -0-

Concord and the Concord logo are registered trademarks and Network Health is a trademark of Concord Communications, Inc. All other trademarks, registered trademarks, and service marks are the properties of their respective owners.

CONTACT: Jackie Lustig or Christine Washburn

Neva Group, Inc. Concord Communications, Inc.

617-441-4000, ext. 229 508-460-4646, ext. 126

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