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May 31, 2011 - PAETEC Completes Acquisition of XETA Technologies

Acquisition builds on PAETEC's strategy of offering comprehensive, managed service solutions to meet the diverse needs of Chief Information Officers


FAIRPORT, N.Y. and BROKEN ARROW, Okla. - May 31, 2011 (Print-friendly PDF file)

PAETEC Holding Corp. (NASDAQ GS: PAET), a nationwide provider of comprehensive communications solutions, today announced that it has completed its acquisition of XETA Technologies, Inc, which was publicly traded on NASDAQ under the symbol XETA. Upon the close of the acquisition earlier today, XETA joined PAETEC's Managed Services division specializing in comprehensive equipment solutions which now has approximately $200MM in pro forma combined annual revenue.

"Building on our prior acquisitions in this space, XETA Technologies gives us a true national footprint for equipment solutions leveraging our strong relationships with the major equipment manufactures in the business," said Arunas Chesonis, PAETEC chairman and CEO. "Our goal is to serve the needs of the office of CIO unlike any other provider in the industry, from the desktop to the cloud and all points in-between. Today, as a result of this acquisition, we're better equipped to do that than ever before."

Founded in 1981, XETA Technologies sells, installs and services advanced communication technologies for enterprise customers. XETA is among the largest full-service, providers of advanced communications solutions with 32 locations and redundant 24/7 customer contact and data network operating centers.  Prior to the Avaya and Nortel merger, XETA was the only national provider with the highest accreditations from both companies, and will expand on those relationships with PAETEC's existing platinum partnership with Avaya. XETA's national coverage is ideally suited to serve large, multi-locations organizations such as PAETEC's enterprise network customer base.

PAETEC has a long history of developing managed services solutions using hardware dating back to 1999 with the acquisition of East Florida Communications, Inc. and Data Voice Networks in 2000. In 2010, PAETEC acquired the Folsom, Calif.-based Quagga Corp with significant customer base in California, Nevada and Arizona. Today, PAETEC is one of the largest providers of comprehensive business solutions leveraging manufacturers like Avaya, Cisco, ADTRAN, and Nortel.  As value added services on hardware, PAETEC offers network engineering consultation and hardware management support, as well as a unique financing program called Equipment for Services (EFS). Under the EFS program, a portion of profitability of a company's spend on network services can be designated towards an equipment lease for needed routers, servers, phone systems, or other office equipment.

With the acquisition, PAETEC's managed services division will have substantial employee centers near Tulsa, Okla., St. Louis, Mo., Sacramento, Calif., Philadelphia, Pa. and Daytona, Fla., along with employees in various other locations nationwide.

To learn more about XETA Technologies, visit www.xeta.com.


About PAETEC
PAETEC (NASDAQ: PAET), a FORTUNE 1000 company, is personalizing business communications for businesses, enterprise organizations and institutions across the United States. We offer a comprehensive suite of IP, voice, data, and Internet services, as well as enterprise communications management software, network security solutions, CPE, and managed services. For more information, visit www.paetec.com.