NHC Communications Inc. announces important progress in its penetration of the ILEC and large carrier market worldwide

Company also receives $2.7 million insurance claim and provides business

update on other selected specifics



Apr 30, 2001, 01:00 ET from NHC Communications Inc.

    MONTREAL, April 30 /PRNewswire/ - NHC Communications Inc. (TSE: NHC), a
 leading provider of carrier class test access and deployment solutions for the
 copper- based telecommunications and Internet access markets, today announced
 it has shipped its ControlPoint(TM) solutions to a second Incumbent Local
 Exchange Carrier (ILEC) for two First Office Applications (FOAs). The Company
 has also shipped its ControlPoint(TM) solutions to a large European ILEC and
 two Inter- Exchange Carriers (IXCs) for their evaluation. By the end of May
 2001, a total of eight large telecommunications carriers, including five North
 American ILECs and one European ILEC are planned to be in different stages of
 analysis of ControlPoint(TM).
     "Between the eight large carriers that the Company is currently working
 with, ControlPoint(TM) is being tested under FOAs or trials for various
 broadband DSL and voice line-management based applications in both remote
 unmanned and city center central offices," said Sylvain Abitbol, President and
 CEO of NHC Communications. "These eight ILECs and IXCs represents a solid
 base, for a wide range of applications and presents us with a very large
 potential market."
     The Company is at different stages of the sales cycle in the context of
 its current discussions with ILECs and IXCs in North America and Europe for
 the sale of its ControlPoint(TM) solutions. The trials serve as an initial
 endorsement of carriers' needs to improve broadband DSL provisioning times and
 voice line-management based applications, and are normally performed by the
 lab department of a carrier. FOAs are performed much further in the purchasing
 decision process of a carrier. At this point, the carrier has decided to
 dedicate important internal resources of different departments to the analysis
 and documentation of the performance of a product in a live telecommunications
 environment.
     In all cases, including NHC's recently announced ILEC agreement, the
 procedures and processes are on schedule and progressing as planned.
 
     "The ILEC and IXC accounts are difficult to penetrate and normally
 involve long product adoption cycles. However, NHC's ControlPoint(TM)
 solutions significantly reduce the operating costs of providing service and
 provide carriers with very short pay-back periods on their investments. This
 fact, combined with significant technological advantages, is a key factor that
 explains our success and our penetration efforts of those accounts for this
 particular market niche," added Mr. Abitbol.
 
     Business Update on Other Selected Specifics
 
     $2.7 Million cash-inflow in addition to the previously announced $10
     Million from the Bought-Deal transaction
 
     The Company received a payment of $2.7 million from the Export
 Development Corporation (EDC) through an insurance claim related to the
 outstanding balance receivable from a contract with a CLEC customer. NHC's
 insurance covered $2.7 million of the $3.9 million shipment delivered to the
 CLEC last year.
     "This CLEC has eased back on its deployment schedule, but plans to
 continue to install NHC's ControlPoint(TM) solutions in several new central
 offices," said Mr. Abitbol. "Although we do not expect further orders from
 this customer in fiscal 2001, this CLEC is very pleased with our technology,
 which will be utilized as deployment plans progress."
     Negotiations are underway between NHC, the EDC and the CLEC customer for
 the remaining balance of $1.2 million. Any potential write-down of any portion
 of this balance receivable would be offset against deferred revenue and would
 not have an adverse impact on future results.
     The $2.7 million collected will be accounted as revenue for the third
 quarter of fiscal 2001, in accordance with the Company's new accounting policy
 on revenue recognition.
     On March 30, NHC closed a financing agreement through the sale of
 3,335,000 units, consisting of one common share and one half of one common
 share purchase warrant. The units were priced at $3 per unit, for total gross
 proceeds of $10 million. In addition, each full warrant entitles the holder to
 purchase one common share of NHC at a purchase price of $4 until March 29,
 2003. If fully exercised, these warrants will provide NHC with an additional
 $6.67 million in capital.
     NHC remains confident that it will be able to execute its focused growth
 strategy successfully. The Company has a strong management team worldwide and
 well-financed targeted customers. These customers have expressed a strong need
 for NHC's ControlPoint(TM) solutions, which are helping them to accelerate
 their deployment plans, while at the same time providing them with a very
 quick pay-back period for their investment. Concurrently, the cash provided
 from collection of the insurance claim, along with the cash generated by the
 proceeds of the financing and the potential proceeds from this same financing,
 are improving NHC's financial structure to support its growth. NHC plans to
 continue investing in its pre and post-sales infrastructure at the Company's
 US subsidiary, NHC Communications USA, Inc., which is considered to be a key
 aspect to satisfying the support requirements of the larger telecommunications
 carriers.
     "Our ability to raise capital in these conditions points to the financial
 markets' confidence in NHC's ability to execute its business plan," continued
 Mr. Abitbol.
 
     Europe and Asia
 
     NHC continues to address the European market through its French
 subsidiary NHC Europe S.A. NHC's penetration of this market has been
 developing faster than anticipated. The Company has recently completed lab
 trials with a major European ILEC and is currently planning a field FOA in the
 near future. Moreover, and in accordance with its previously announced focused
 growth strategy, negotiations are underway for partnerships that are expected
 to support NHC's expansion plans for the European territory. "This is a very
 important market for NHC, and we are facing some exciting opportunities
 there," said Mr. Abitbol.
     The Asian DSL market is also booming. In November 2000, NHC announced an
 agreement with Taiwan-based distributor Delhum Technology & Services Corp
 (DTSC). Through this agreement, NHC is very well positioned to address this
 growing market. According to Chong Hwa Telecom, a Taiwanese ILEC, the DSL
 market in Taiwan alone is expected to grow by more than 1.2 million
 subscribers by the end of fiscal 2001.
 
     Market Outlook
 
     NHC has not received any indication from its customers or potential
 customers that capital expenditure in the Company's particular market niche is
 declining. "The telecommunications carriers with whom we are currently in
 discussions have reiterated their plans to maintain their investment in the
 DSL market, and we believe that NHC has the leading physical-layer cross-
 connect solution," said Mr. Abitbol. "Each ControlPoint(TM) unit can manage
 seven times the capacity of the largest competing product. Additionally, our
 solution is based on reliable, cost-effective robotic technology."
     With increasing demand for high-speed Internet access, and pressure from
 regulators to speed up deployment plans, the global DSL market remains strong.
 Demand for DSL service is driving an increase in the number of changes in
 telecommunications connections - changes that NHC's ControlPoint(TM) solutions
 are specifically designed to handle. As a result, the Company remains
 optimistic that sales of its ControlPoint(TM) solutions will strengthen.
 
     About NHC Communications:
     With offices in Montreal, Paris, France and Manassas, Virginia, NHC
 Communications is an international leader in the design and manufacture of
 innovative, remotely controlled physical layer cross-connect solutions for
 established and next-generation voice/data networks. With a unique range of
 technologies developed from years of experience, NHC now is at the heart of
 today's corporate enterprise service market and the telecommunications
 industry.
 
     Statements included here, which are not historical in nature, are forward-
 looking statements made pursuant to the safe harbor provisions of the Private
 Securities Litigation Reform Act of 1995, including without limitation,
 statements as to management's beliefs, strategies, plans, expectations or
 opinions in connection with the Company's performance, which are based on a
 number of assumptions concerning future conditions that may ultimately prove
 to be inaccurate. In addition, other forward-looking statements that may be
 included here must be qualified by important factors that could cause actual
 results to differ materially from those achieved in the past or those expected
 by the Company. These include: rapid technological change along with the need
 to continually develop new products; the Company's dependence on a dominant
 product line; competition; the Company's dependence on key employees;
 difficulties in managing the Company's growth; the Company's dependence upon
 certain customers and certain suppliers; the Company's dependence upon
 proprietary rights; risks of third party claims of infringement; and
 government regulation.
 
 

SOURCE NHC Communications Inc.
    MONTREAL, April 30 /PRNewswire/ - NHC Communications Inc. (TSE: NHC), a
 leading provider of carrier class test access and deployment solutions for the
 copper- based telecommunications and Internet access markets, today announced
 it has shipped its ControlPoint(TM) solutions to a second Incumbent Local
 Exchange Carrier (ILEC) for two First Office Applications (FOAs). The Company
 has also shipped its ControlPoint(TM) solutions to a large European ILEC and
 two Inter- Exchange Carriers (IXCs) for their evaluation. By the end of May
 2001, a total of eight large telecommunications carriers, including five North
 American ILECs and one European ILEC are planned to be in different stages of
 analysis of ControlPoint(TM).
     "Between the eight large carriers that the Company is currently working
 with, ControlPoint(TM) is being tested under FOAs or trials for various
 broadband DSL and voice line-management based applications in both remote
 unmanned and city center central offices," said Sylvain Abitbol, President and
 CEO of NHC Communications. "These eight ILECs and IXCs represents a solid
 base, for a wide range of applications and presents us with a very large
 potential market."
     The Company is at different stages of the sales cycle in the context of
 its current discussions with ILECs and IXCs in North America and Europe for
 the sale of its ControlPoint(TM) solutions. The trials serve as an initial
 endorsement of carriers' needs to improve broadband DSL provisioning times and
 voice line-management based applications, and are normally performed by the
 lab department of a carrier. FOAs are performed much further in the purchasing
 decision process of a carrier. At this point, the carrier has decided to
 dedicate important internal resources of different departments to the analysis
 and documentation of the performance of a product in a live telecommunications
 environment.
     In all cases, including NHC's recently announced ILEC agreement, the
 procedures and processes are on schedule and progressing as planned.
 
     "The ILEC and IXC accounts are difficult to penetrate and normally
 involve long product adoption cycles. However, NHC's ControlPoint(TM)
 solutions significantly reduce the operating costs of providing service and
 provide carriers with very short pay-back periods on their investments. This
 fact, combined with significant technological advantages, is a key factor that
 explains our success and our penetration efforts of those accounts for this
 particular market niche," added Mr. Abitbol.
 
     Business Update on Other Selected Specifics
 
     $2.7 Million cash-inflow in addition to the previously announced $10
     Million from the Bought-Deal transaction
 
     The Company received a payment of $2.7 million from the Export
 Development Corporation (EDC) through an insurance claim related to the
 outstanding balance receivable from a contract with a CLEC customer. NHC's
 insurance covered $2.7 million of the $3.9 million shipment delivered to the
 CLEC last year.
     "This CLEC has eased back on its deployment schedule, but plans to
 continue to install NHC's ControlPoint(TM) solutions in several new central
 offices," said Mr. Abitbol. "Although we do not expect further orders from
 this customer in fiscal 2001, this CLEC is very pleased with our technology,
 which will be utilized as deployment plans progress."
     Negotiations are underway between NHC, the EDC and the CLEC customer for
 the remaining balance of $1.2 million. Any potential write-down of any portion
 of this balance receivable would be offset against deferred revenue and would
 not have an adverse impact on future results.
     The $2.7 million collected will be accounted as revenue for the third
 quarter of fiscal 2001, in accordance with the Company's new accounting policy
 on revenue recognition.
     On March 30, NHC closed a financing agreement through the sale of
 3,335,000 units, consisting of one common share and one half of one common
 share purchase warrant. The units were priced at $3 per unit, for total gross
 proceeds of $10 million. In addition, each full warrant entitles the holder to
 purchase one common share of NHC at a purchase price of $4 until March 29,
 2003. If fully exercised, these warrants will provide NHC with an additional
 $6.67 million in capital.
     NHC remains confident that it will be able to execute its focused growth
 strategy successfully. The Company has a strong management team worldwide and
 well-financed targeted customers. These customers have expressed a strong need
 for NHC's ControlPoint(TM) solutions, which are helping them to accelerate
 their deployment plans, while at the same time providing them with a very
 quick pay-back period for their investment. Concurrently, the cash provided
 from collection of the insurance claim, along with the cash generated by the
 proceeds of the financing and the potential proceeds from this same financing,
 are improving NHC's financial structure to support its growth. NHC plans to
 continue investing in its pre and post-sales infrastructure at the Company's
 US subsidiary, NHC Communications USA, Inc., which is considered to be a key
 aspect to satisfying the support requirements of the larger telecommunications
 carriers.
     "Our ability to raise capital in these conditions points to the financial
 markets' confidence in NHC's ability to execute its business plan," continued
 Mr. Abitbol.
 
     Europe and Asia
 
     NHC continues to address the European market through its French
 subsidiary NHC Europe S.A. NHC's penetration of this market has been
 developing faster than anticipated. The Company has recently completed lab
 trials with a major European ILEC and is currently planning a field FOA in the
 near future. Moreover, and in accordance with its previously announced focused
 growth strategy, negotiations are underway for partnerships that are expected
 to support NHC's expansion plans for the European territory. "This is a very
 important market for NHC, and we are facing some exciting opportunities
 there," said Mr. Abitbol.
     The Asian DSL market is also booming. In November 2000, NHC announced an
 agreement with Taiwan-based distributor Delhum Technology & Services Corp
 (DTSC). Through this agreement, NHC is very well positioned to address this
 growing market. According to Chong Hwa Telecom, a Taiwanese ILEC, the DSL
 market in Taiwan alone is expected to grow by more than 1.2 million
 subscribers by the end of fiscal 2001.
 
     Market Outlook
 
     NHC has not received any indication from its customers or potential
 customers that capital expenditure in the Company's particular market niche is
 declining. "The telecommunications carriers with whom we are currently in
 discussions have reiterated their plans to maintain their investment in the
 DSL market, and we believe that NHC has the leading physical-layer cross-
 connect solution," said Mr. Abitbol. "Each ControlPoint(TM) unit can manage
 seven times the capacity of the largest competing product. Additionally, our
 solution is based on reliable, cost-effective robotic technology."
     With increasing demand for high-speed Internet access, and pressure from
 regulators to speed up deployment plans, the global DSL market remains strong.
 Demand for DSL service is driving an increase in the number of changes in
 telecommunications connections - changes that NHC's ControlPoint(TM) solutions
 are specifically designed to handle. As a result, the Company remains
 optimistic that sales of its ControlPoint(TM) solutions will strengthen.
 
     About NHC Communications:
     With offices in Montreal, Paris, France and Manassas, Virginia, NHC
 Communications is an international leader in the design and manufacture of
 innovative, remotely controlled physical layer cross-connect solutions for
 established and next-generation voice/data networks. With a unique range of
 technologies developed from years of experience, NHC now is at the heart of
 today's corporate enterprise service market and the telecommunications
 industry.
 
     Statements included here, which are not historical in nature, are forward-
 looking statements made pursuant to the safe harbor provisions of the Private
 Securities Litigation Reform Act of 1995, including without limitation,
 statements as to management's beliefs, strategies, plans, expectations or
 opinions in connection with the Company's performance, which are based on a
 number of assumptions concerning future conditions that may ultimately prove
 to be inaccurate. In addition, other forward-looking statements that may be
 included here must be qualified by important factors that could cause actual
 results to differ materially from those achieved in the past or those expected
 by the Company. These include: rapid technological change along with the need
 to continually develop new products; the Company's dependence on a dominant
 product line; competition; the Company's dependence on key employees;
 difficulties in managing the Company's growth; the Company's dependence upon
 certain customers and certain suppliers; the Company's dependence upon
 proprietary rights; risks of third party claims of infringement; and
 government regulation.
 
 SOURCE NHC Communications Inc.