Funding to Drive Continued Corporate and Product Line Expansions

Linux Networx, The Linux Supercomputing Company, recently announced that it has completed a $37 million round of funding. The round includes new investors Lehman Brothers, Inc. and Canaccord Adams, as well as existing investors Oak Investment Partners and Tudor Ventures. The funding will drive the next phase in the company's strategy of delivering solutions that further reduce total cost of ownership, and improve the performance, manageability and utilization of Linux Supercomputers.

"Linux Networx has extensive supercomputing experience and a strong market position making it a highly attractive investment opportunity," said Eric Salzman of Lehman Brothers' Global Trading Strategies Group. "We look forward to working with the Linux Networx team to build a dominant company in the supercomputing industry."

"Linux Networx has achieved five consecutive quarters of year over year ascending bookings growth following our initial investment. We are pleased with the company's progress and welcome our new investors in this round," said Ed Glassmeyer, managing partner of Oak Investment Partners. "Linux clusters represent the future of supercomputing , and Linux Networx is increasing it 's market share."

"This funding further validates our leadership in Linux supercomputing and reaffirms our investors' confidence in the company's continued growth," said Robert (Bo) H. Ewald, CEO of Linux Networx. "Expect us to deliver Linux Supersystems that drive even better levels of price/performance and improved supercomputing productivity for our customers."

Linux Networx delivers clustered Linux supercomputers that operate as production-ready supercomputing systems, driving increased application performance while reducing the high complexity and cost associated with traditional clusters. The recent funding round will accelerate LNXI software offerings - designed to improve systems management, reliability, performance tuning and overall utilization of Linux Supercomputers. The company will share software offering details later in 2006.

Oak Investment Partners, Tudor Ventures and individual private investors have previously funded Linux Networx. Cannacord Adams served as placement agent in connection with the recent funding.