Tut to Acquire Copper MountainTut to Acquire Copper Mountain

Following its deal to acquire CoSine, Tut agrees to pick up Copper Mountain for roughly $10M in stock

February 11, 2005

3 Min Read

LAKE OSWEGO, Ore. -- Tut Systems, Inc. (NASDAQ:TUTS) today announced that it has signed a definitive merger agreement to acquire all of the outstanding shares of common stock of Copper Mountain Networks, Inc. (NASDAQ:CMTN) in a stock-for-stock transaction valued at approximately $10 million. Upon closing, Tut Systems will issue approximately 2.5 million shares of its common stock to the shareholders of Copper Mountain Networks. Approximately 25.2 million shares of Tut Systems common stock are currently outstanding. In a separate, previously announced merger, Tut Systems has also agreed to acquire CoSine Communications, Inc. in a stock-for-stock transaction, and if approved by the stockholders of CoSine and Tut Systems, Tut Systems would issue approximately 6.0 million shares of its common stock to the shareholders of CoSine. Each transaction is expected to close in the second quarter of 2005, and each is subject to applicable stockholder approvals, and other customary closing conditions.

Tut Systems is acquiring Copper Mountain Networks primarily to acquire additional product and engineering resources, which will be refocused to address the expanding IPTV market opportunities. Tut Systems plans to incorporate Copper Mountain's intellectual property and certain product elements into its growing video-centric product portfolio. As a result of the transaction, Tut Systems will retain certain Copper Mountain employees from development centers in Palo Alto and San Diego and retain Copper Mountain's San Diego facility. Tut Systems will honor Copper Mountain's existing customers' support agreements.

"We have witnessed an acceleration of the IPTV market opportunities world- wide and we wanted to accelerate, enhance and broaden our Multi-edge video content processing solution portfolio," said Sal D'Auria, Chairman, President and CEO of Tut Systems. "We are very excited about the powerful technology and the world-class engineering team that will become part of Tut Systems' initiatives. This transaction with Copper Mountain Networks accelerates our plans for industry leadership."

In a separate release:

PALO ALTO, Calif. -- Copper Mountain Networks, Inc. (Nasdaq:CMTN), a provider of intelligent broadband access solutions, today announced that after an extensive evaluation of strategic alternatives, the Company has signed a definitive merger agreement with Tut Systems, Inc. (Nasdaq:TUTS) of Lake Oswego, OR. Under this agreement, Tut Systems will acquire all of the outstanding shares of common stock of Copper Mountain in a stock-for-stock transaction valued at approximately $10.0 million. Upon closing, Tut Systems will issue approximately 2.5 million shares of its common stock to the shareholders of Copper Mountain Networks, Inc. Approximately 25.2 million shares of Tut Systems common stock are currently outstanding. (Tut Systems has also agreed to acquire CoSine Communications in a stock-for-stock transaction, and if that transaction is consummated, Tut Systems would issue approximately 6.0 million shares of Tut Systems common stock to shareholders of CoSine.) Subject to approval of the transaction by the stockholders of Copper Mountain and to other customary closing conditions, the transaction is expected to close in the second quarter of 2005.

Tut Systems Inc.

Copper Mountain Networks Inc.

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