Sorrento Completes LuxN Buy

SAN DIEGO -- Sorrento Networks (Nasdaq: FIBR - News), a supplier of optical networking equipment for carriers and enterprises worldwide, today announced that it has successfully closed the acquisition of LuxN, Inc. On June 26, 2003, Sorrento had announced its plan to acquire LuxN.

LuxN supplies optical access equipment for the network edge using coarse and dense wavelength division multiplexing (CWDM and DWDM) technology. LuxN's OSMINE-certified products enable delivery of high-bandwidth data, storage, video, and voice services for service providers, cable MSOs, and enterprises.

The acquisition expands Sorrento's addressable market by adding "best-of-breed" optical access products to Sorrento's metro/regional portfolio and enhances the Company's edge-to-core network offerings. The union also broadens Sorrento's 30-plus blue-chip customer base by adding over 20 new customers including Time Warner Telecom, Hawaii I-Net, Yipes Enterprise Services, and numerous universities.

"LuxN is a key step in our growth strategy, which is to thoughtfully but aggressively expand our product and customer base," stated Phil Arneson, chairman and chief executive officer of Sorrento Networks. "LuxN's feature-rich products enable incremental cross-selling revenue opportunities with Sorrento's account base, and vice versa. Many customers have already expressed strong interest in evaluating the expanded product family. Additionally, the combined product line allows Sorrento to capture customers new to both companies."

Sorrento acquired LuxN for a combination of stock, warrants, and cash previously held by LuxN. Stockholders of LuxN were given the option of exchanging shares of LuxN stock for either their pro-rata portion of LuxN's net cash or shares of Sorrento's common stock. Stockholders with an aggregate pro-rata portion of $3.8 million of LuxN's net cash elected to receive Sorrento's common stock. In addition to the cash or Sorrento common stock, stockholders of LuxN have the right to receive warrants to purchase an aggregate of 400,000 shares of Sorrento common stock, with an exercise price of $3.05 per share. The warrants will be held in escrow for a period of six months to satisfy any successful indemnification claims. At closing, Sorrento issued approximately 1.4 million shares of common stock with the remaining approximately 500,000 shares of common stock to be issued subject to stockholder approval. Additional details will be forthcoming in Sorrento's SEC filings.

Sorrento Networks Corp.

LuxN Inc.