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Airespace Secures Additional $20 Million in Mezzanine Funding

Company Finishes Substantial Up Round. Announces Promotion of Robert Tinker to VP of Business Development

Airespace, Inc. today announced that it has secured $20 million in mezzanine funding, bringing the total investment in the company to $58 million. The latest round, which marked a dramatic increase in valuation for Airespace, was fully subscribed by the company's existing investors, demonstrating their confidence in Airespace's leadership position in the rapidly expanding enterprise Wireless LAN (WLAN) market. Airespace's primary investors include Battery Ventures, Fidelity Ventures, Norwest Venture Partners, Storm Ventures, Hotung Capital, and KTB Ventures.

The latest round of financing will be used to provide working capital to accelerate Airespace's market expansion and march to cash flow profitability. It comes on the heels of an extremely successful year for Airespace, which included the following accomplishments:

--  Significant Customer Traction -- Since first shipping product in April
    of 2003, Airespace has delivered wireless networks to several hundred
    enterprise customers, including Fortune 500 companies, hospitals,
    universities, arenas, airports, military facilities, and corporations
    throughout the world.

--  World Class Partners -- Airespace has established global OEM
    agreements with Alcatel, NEC, and Nortel, three of the world's leading
    network equipment providers.  In addition, Airespace has also established
    partnerships with D-Link Systems and Value Added Resellers (VARs),
    distributors, and support organizations throughout the world.

--  Global Corporate Expansion -- Airespace has expanded its global
    operations with the opening of new offices in the United Kingdom and
    throughout Europe, and offices in Japan and throughout Asia to meet the
    global demand for enterprise WLAN systems.

--  Industry Recognition -- Airespace has won 19 industry awards and
    industry distinctions over the last year.  The company has never lost a
    head-to-head product bakeoff, has secured numerous "Product of the Year"
    awards, and earned several distinctions as a "company to watch" in leading
    industry publications.
    

"This latest round of funding is a strong validation of Airespace's enormous accomplishments over the past several years," said Brett Galloway, chief executive officer and president of Airespace. "Ongoing support and guidance from our investors will help Airespace continue to demonstrate success in a rapidly growing enterprise WLAN market."

In addition, Airespace announced today the promotion of Robert Tinker to vice president of business development. In this role, Bob will continue to create and oversee world class business and technology partnerships that will complement the Airespace platform and facilitate the company's ability to execute in an explosive global WLAN market. As director of business development, Bob spearheaded Airespace's OEM partnerships, which have played a significant role in the company's tremendous success to date.

Bob has a long history in the networking and telecommunications space, having performed a variety of business development, product management, marketing, and IT functions at several companies, including Vertical Networks and Nationsbank (now Bank of America). In addition, Bob founded Layer 8, a forum that promotes discussion among leaders of communications and Internet infrastructure companies.

"Bob's leadership skills, vision and strong ability to execute have helped Airespace to establish extremely successful relationships with world class organizations, such as Alcatel, NEC, and Nortel," said Brett Galloway. "As we continue to grow the company and our business, Bob's experience and talent will be a key element of our success."

About Airespace, Inc.

Airespace designs and develops intelligent wireless networking platforms that support business-critical applications. The company has set the standard for enterprise Wireless LANs, having earned CMP LLC's "Best of Interop Award," Network Computing's "Editor's Choice Award" and "Well Connected Product of the Year," Network World's "World Class Award" and "Best of the Test Award," IDG's Network Award 2004, Internet Telephony's "Product of the Year," eWeek's "Annual Excellence Award," and nomination as one of the "Best Wireless Products of 2003" in InfoWorld's "Reader's Choice" Awards. With dynamic RF management, air-tight security, seamless mobility, and support for real-time applications such as voice, Airespace helps enterprises implement secure and manageable Wireless LAN networks worldwide.

For more information on Airespace and its products, visit www.airespace.com or call (+1) 408-635-2000.

Airespace is a registered trademark of Airespace, Inc.