FOR IMMEDIATE RELEASE

Natural Convergence secures CDN$9.3M in Series "A" funding
Company offers compelling solutions to improve Telecom Carrier revenues

OTTAWA, Canada - July 17, 2002 - Natural Convergence Inc., a pioneer of Broadband voice applications, today announced the successful completion of its Series "A" financing round. The round, co-led by Boston-based VIMAC, and Canadian-based BDC Venture Capital, is worth CDN$9.3M, and includes follow-on investment from investors Primaxis Technology Ventures Inc., Jefferson Partners and Purple Angel.

"The successful closure of this round speaks to the strength of our team, our technology and most importantly, our outstanding traction with customers," said David Cork, Chief Executive Officer, Natural Convergence. "Our 'virtual key system' product offering will help Carriers capture new revenues from their small business customers. We'll use this new money to expand business development efforts, to accelerate product development, and to continue recruiting the top talent that has helped us reach this point."

Natural Convergence is putting broadband technology to work, by leveraging the latest in IP, Web and Java technologies. Natural Convergence application software enables the delivery of high value voice services in a way that fundamentally lowers the Carrier's costs to deliver these services. The simple plug-and-play installation and easy to use self-management tools removes the traditional middleman and gives the small business owner total control over their business phone services.

Recognizing the need to reduce 'time to revenue' for the Carrier, Natural Convergence has developed a unique solution that is deployed easily with existing carrier network equipment and is completely portable onto any future next-generation network.

"The small business market is one that has been traditionally underserved by the incumbent Telcos," said Neal Hill, Managing Director, VIMAC. "Natural Convergence has combined a strong business model with an innovative technology offering to capitalize on an untapped revenue pool. We see an enormous market opportunity for this company."

"In a short time, they have assembled an experienced team at Natural Convergence, and have gained great traction with potential customers," said Ron Warburton, Director, BDC Venture Capital. "They understand that small businesses have unique needs, and what works in a company of 400, doesn't necessarily work in a company with less than 40 employees. This understanding has enabled Natural Convergence to zero-in and effectively serve this market."

Natural Convergence is entering Beta trials with lead customers, and is developing a series of unique partnerships with leading vendors of IP Phones, IP/PSTN Gateways and carrier-grade server platforms.

Natural Convergence also announced that Neal Hill, Ron Warburton, and David Harris Kolada, Partner, Jefferson Partners will join Kerri Golden, Vice President, Primaxis Technology Ventures and Irving Ebert, Partner, Purple Angel on the Board of Directors.

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About Natural Convergence
Natural Convergence is an Ottawa based applications software company that develops and markets Broadband voice applications software enabling telecom carriers to better serve their small business customers. Natural Convergence was founded in April 2001 by David Cork and Mark Murray, the former COO and CFO of Nortel's eXtremeVoice division, in partnership with bitHeads, Inc., a premier custom software development company.
www.naturalconvergence.com

About VIMAC
Venture Investment Management Company LLC (VIMAC) is a Boston-based venture capital firm concentrating on early stage information technology companies based in the eastern United States and Canada. With roots that go back to 1982, VIMAC's principals combine venture capital funding with hands-on, senior-level operational experience to help portfolio companies achieve success on a large scale. The firm currently manages over $220 million.
www.vimac.com

About BDC Venture Capital
Established in 1983, BDC's Venture Capital manages a $400 million portfolio invested in over 130 companies across Canada. BDC targets high growth companies in the telecommunications, life sciences and software fields with investments ranging from seed to mezzanine financing. BDC Venture Capital assists its investee companies with senior executive experience in the areas of sales, marketing, business development, production and research. Notable investments include Tundra Semiconductor, SiberCore, IceFyre, Ballard Power Systems, Creo Products, PixStream , Philsar and Tarian Software
www.bdc.ca

About Primaxis Technology Ventures
Primaxis is a Toronto-based, early stage Venture Capital fund that invests in leading-edge opportunities in the physical and engineering sciences. Primaxis works in close partnership with technology inventors and entrepreneurs to build high growth companies. Primaxis' investors include Royal Bank Ventures, BTG International, DuPont Canada, Battelle Memorial Labs, CIC Corporation, MDC Corporation and James Richardson & Sons.
www.primaxis.com

About Jefferson Partners
Jefferson Partners is a leading Toronto based venture capital investment organization focused on three areas of technology: enterprise software, the Internet and communications infrastructure. Jefferson Management currently manages three venture capital pools: Jefferson Partners Fund IV formed in February 2002, Jefferson Partners Technology Fund, L.P. ("JPTF" or "Fund III") formed in 1999 and Jefferson Partners Capital Limited ("JPCL" or "Fund II"), originally formed in 1994. Jefferson has forged strategic alliances on both sides of the border to enhance its ability to attract and assess the best new technology ideas and to add value in bringing those ideas to the global market.
Jefferson also has close working relationships with numerous "Angel" groups and a wide range of technology entrepreneurs and technology experts across North America.
www.jefferson.com

About Purple Angel
Formed in early 2001, Purple Angel is a group of mostly former Nortel Networks executives. Its' mission is to invest, mentor, and guide start-up companies in the Ottawa area. Given the technology and business breadth of the group, the focus is to communications and infrastructure investment.
www.purple-angel.com

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