Gensym Announces Bridge Loan Financing

Business Wire, Oct 18, 2001

Business/Technology Editors

BURLINGTON, Mass.--(BUSINESS WIRE)--Oct. 18, 2001

Gensym (OTC Bulletin Board: GNSM), a leading provider of software and services for expert operations management, today made the following announcements relating to improvements in its overall financial situation.

Gensym has obtained bridge loan financing of approximately $1.0M to meet present cash needs from a group of investors consisting of a Gensym partner and eight individuals, including a Gensym founder and all of the members of its board of directors. The bridge financing is a component of a larger commitment made by these investors to participate as standby purchasers in the previously announced rights offering in which Gensym expects to raise equity capital from its shareholders and vested option holders. In conjunction with their bridge loan and rights offering commitments, two of the investors have the right each to nominate one additional director to Gensym's board.

Gensym further announced that the previously disclosed lawsuit filed against it by Rocket Software, Inc. has been withdrawn after repayment in full by Gensym of funds that Rocket had advanced to Gensym in July of 2001.

About Gensym

Gensym Corporation (www.gensym.com) is a provider of software products and services that enable organizations to automate aspects of their operations that have historically required the direct attention of human experts. Gensym's product and service offerings are all based on or relate to Gensym's flagship product G2, which can emulate the reasoning of human experts as they assess, diagnose, and respond to unusual operating situations or as they seek to optimize operations.

With G2, organizations in manufacturing, communications, transportation, aerospace, and government maximize the performance and availability of their operations. For example, Fortune 1000 manufacturers such as ExxonMobil, DuPont, LaFarge, Eli Lilly, and Seagate use G2 to help operators detect problems early and to provide advice that avoids off-specification production and unexpected shutdowns. Manufacturers and government agencies use G2 to optimize their supply chain and logistics operations. And communications companies such as AT&T, Ericsson Wireless, and Nokia use G2 to troubleshoot network faults so that network availability and service levels are maximized.

Gensym has numerous partners who can help meet the specific needs of customers. Gensym and its partners deliver a range of services, including training, software support, application consulting and complete solutions. Through partners and through its direct sales force, Gensym serves customers worldwide.

Gensym and G2 are registered trademarks of Gensym Corporation.

This news release contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ materially from those anticipated. Such risks and uncertainties include, but are not limited to, the failure to successfully consummate the proposed rights offering, as well as other risks included on Form 10-Q for the quarter ended June 30, 2001, as filed with the Securities and Exchange Commission and available online at http://www.gensym.com. Although Gensym believes the expectations reflected in the forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be attained. Gensym Corporation disclaims any intent or obligation to update any forward-looking statement.