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To: Johnny Canuck who wrote (38595)	12/17/2002 11:37:41 AM
From: Johnny Canuck	Read Replies (1) \| Respond to of 69835

Reuters Tellium frees C&W from contract, to get purchases Tuesday December 17, 10:48 am ET By Sinead Carew NEW YORK, Dec 17 (Reuters) - Tellium Inc. (NasdaqSC:TELM - News) on Tuesday said it freed Cable & Wireless Plc (London:CW.L - News) of obligations to buy $350 million worth of network gear in return for the purchase of an unspecified amount of equipment next year. ADVERTISEMENT Network equipment maker Tellium said the deal gives it a better view of next year's results as telecommunications service provider Cable & Wireless agreed to buy some of its products in the first and second quarter. "This will generate significant amount of cash to the bottom line because we have the inventory on hand," Tellium Chairman and Chief Executive Harry Carr told Reuters. "Most investors had written off Cable and Wireless as a source of revenue." Carr was unable to be more specific about the terms of the purchase agreement. Once Cable & Wireless fulfills the agreement it is no longer required to place orders for $350 million worth of Tellium's Aurora networking switching products before August 2005, as stipulated in an August 2000 contract between the companies. "Since we signed the original contract a lot of things have changed in the telecommunications business, for the industry as a whole and for Cable & Wireless," Carr said in a statement. Tellium, which has suffered along with competitors including Lucent (NYSE:LU - News) and Nortel Networks (Toronto:NT.TO - News) from severe cuts in phone company budgets, is also working on other contracts for next year, Carr said. "There's still a focus on the U.S. but the extended focus is on Europe and Asia. We do see carriers there not quite in the same shape as in the U.S.," Carr said. Cable & Wireless revealed last week that it needed to find cash tocover a huge potential tax liability after a year in which it issued three profit warnings and cut thousands of jobs. Tellium stock rose 7 cents to 68 cents in morning trade on the Nasdaq stock market.