VNWK Visual Networks (MM)

ROCKVILLE, Md., Aug. 10 /PRNewswire-FirstCall/ -- Visual Networks, Inc. (NASDAQ:VNWK), a leading provider of network and application performance management solutions, today announced that it has successfully completed a private placement of $10 million in senior secured convertible notes to Special Situations Funds. The debt is secured by all of Visual Networks' assets and may be converted by the investors at any time into common stock of the company at a conversion price of $1.45 per share, which, if fully converted, represents 6.9 million shares of Visual Networks' common stock. The company has registration obligations with respect to the common stock issuable upon conversion. The capital will be used to pay off the company's existing debt as well as its last remaining convertible debenture. The remaining proceeds will be used for working capital and general corporate purposes. The notes mature on December 31, 2007. The company does not have a prepayment right with respect to the notes. Shareholder approval will also be required for certain aspects of the transaction which the company will seek following the closing of the sale. "This important piece of financing enables us to shore up our balance sheet significantly," said Larry Barker, President and CEO of Visual Networks. "Special Situations Funds has been a long-term supporter of the company and we are appreciative of this continued strong working relationship." About Visual Networks Visual Networks, Inc. (NASDAQ:VNWK) is a leading provider of network and application performance management solutions. The company's technologies enable enterprises to reliably and securely manage the delivery and performance of key applications such as Voice over IP (VoIP) across their infrastructures. Visual Networks' products increase application and network availability, optimize the use of bandwidth across the network, and reduce operating costs across traditional and IP-based infrastructures. For more information, visit http://www.visualnetworks.com/. Forward Looking Statement Certain statements in this press release may constitute "forward-looking statements" with respect to Visual Networks, Inc. and its subsidiaries (collectively, the "Company"). Forward-looking statements are based on management's views and assumptions regarding business performance and future events as of the time the statements are made. These statements involve risks and uncertainties, including the risks detailed in Visual Networks' filings with the U.S. Securities and Exchange Commission, which may cause actual results of the Company to differ materially from the statements. By making these forward-looking statements, the Company undertakes no obligation to update these statements for revision or changes after the date of this release. DATASOURCE: Visual Networks, Inc. CONTACT: David Peikin of Visual Networks, Inc., +1-301-296-2262, or Web site: http://www.visualnetworks.com/

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