News Release

Compaq and Cisco Extend Strategic Partnership To Joint Sales and Marketing

Agreement Provides for Joint Marketing, Sales and
Jul 29, 1996

Agreement Provides for Joint Marketing, Sales and PromotionalActivities to Develop Market for Industry-Standard Platforms Hosting CiscoIOS Software Technology

HOUSTON and SAN JOSE, July 29, 1996 - Compaq Computer Corporation(NYSE:CPQ) and Cisco SystemsIncorporated (NASDAQ:CSCO) today announcedthat they have entered into a multi-year, worldwide agreement to developthe market for industry-standard networking platforms using Cisco IOSsoftware technology. This agreement extends the existing Compaq and Ciscostrategic partnership, announced last year, to joint sales andmarketingactivities. These joint activities are targeted at expanding demand fornetworking products and complete client/server network solutions for smalland mid-sized businesses, branch offices and workgroups.

"Compaq has a high level of success at leveraging marketing partnershipsto provide powerful and integrated solutions to its customers," said DougPushard, vice president, Networking Products Division, Compaq ComputerCorporation. "This agreement with Cisco will give Compaq direct access tothe industry's premier source of internetworking expertise and this willenable wider availability of the benefits of Cisco IOS software technologythrough Compaq's extensive distribution partners."

As part of the new agreement, Compaq and Cisco will jointly participatein market development activities such as joint seminars, promotions, andgrowth and competitive replacement programs in target markets. Inaddition, the companies will recruit and train resellers, and will traineach other's field sales and engineering organizations on their respectiveproducts. Both companies will continue to independently sell and supporttheir own products, and will jointly support the sales of internetworkingproducts through existing Compaq distribution channels.

"Cisco believes that Compaq embodies a major win in our strategy tomake Cisco IOS software technology the industry-standard forinternetworking." said Selby Wellman, Senior Vice President, BusinessUnits, Cisco Systems. "With this agreement, both companies can expandtheir customer solutions and market presence beyond what either of uscould achieve on our own."

The companies also expect to extend their partnership into otherproduct and sales opportunities that will meet their mutual goals ofnetworking market expansion.

"In order to be successful in this fast growing networking market,vendors need a unique and powerful assembly of industry-leadingtechnologies to provide integrated solutions to real-world problems. Thesolutions have to be cost effective and widely available," said RichardChernick, President of Connecting Point, a reseller located in Green Bay,Wisconsin. "By joining forces, Compaq Computer and Cisco Systems, areuniquely positioned to fulfill these requirements."

Compaq and Cisco signed a joint development agreement last year tointegrate Cisco IOS software technology features into an industry-standardplatform to be sold by Compaq under its Netelligent brand. The newrouting platform is currently installed in multiple beta sites. Productinformation and reseller locations for Compaq Netelligent products can beobtained by calling (800) 544-5255.

Company Background

Compaq Computer Corporation, aFortune 100 company and the world'slargest supplier of personal computers, delivers useful innovation throughproducts that network people with information. Compaq is strategicallyorganized to meet the current and future needs of its customers, offeringenterprise computing solutions, networking products, commercial PCproducts and consumer PCs. In 1995, the company reported worldwide salesof $14.8 billion. The company is an industry leader in environmentallyfriendly programs and business practices. Compaq products are sold andsupported in more than 100 countries through a network of authorizedCompaq marketing partners. Customer support and information about Compaqand its products can be found at or by calling(800) OK-COMPAQ. Product information and reseller locations can beobtained by calling (800) 345-1518.

Cisco Systems (NASDAQ: CSCO) is the leading globalsupplier of internetworkingsolutions for corporate intranets and the global Internet.Cisco's products, including routers, LAN and ATM switches, dial-up accessservers and network management software, are integrated by the Cisco IOS software to linkgeographically dispersed LANs, WANs and IBM networks.Company news and product/service information are available at World WideWeb site is headquartered in San Jose, California.

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

For further editorial information, contact:

Compaq Computer Corporation Dave Anderson 713-514-0484
Miller/Shandwick Technologies Eric Grodziski 617-536-0470
Cisco Systems, Inc. Robert Michelet 408-526-6636