MegaPath Makes Strategic Investment in, with Option to Acquire, DSL.net; Acquisition Would Strengthen Market Position and Provide Customers with Broader Selection and Higher Quality Services.COSTA MESA Costa Mesa (kŏs`tə mā`sə), city (1990 pop. 96,357), Orange co., S Calif., on the Pacific south of Santa Ana; inc. 1953. It is a transportation, residential, and light industrial center. , Calif. -- MegaPath Inc., the leading provider of Virtual Private Network (VPN (Virtual Private Network) A private network that is configured within a public network (a carrier's network or the Internet) in order to take advantage of the economies of scale and management facilities of large networks. ) solutions and other managed IP services to businesses nationwide, announced that it has made a strategic investment in DSL DSL in full Digital Subscriber Line Broadband digital communications connection that operates over standard copper telephone wires. It requires a DSL modem, which splits transmissions into two frequency bands: the lower frequencies for voice (ordinary .net, Inc. (OTCBB OTCBB See OTC Bulletin Board (OTCBB). : DSLN) which will allow MegaPath to acquire substantially all of the equity of DSL.net upon receiving regulatory and shareholder approval. This acquisition, which involves additional funding from existing MegaPath investors, would further strengthen the Company's market position and enable it to deliver a wider selection of managed IP (Internet Protocol See Internet and TCP/IP. (networking) Internet Protocol - (IP) The network layer for the TCP/IP protocol suite widely used on Ethernet networks, defined in STD 5, RFC 791. IP is a connectionless, best-effort packet switching protocol. ) data, voice and security services Security services are state institutions for the provision of intelligence, primarily of a strategic nature, but also including protective security intelligence. Examples include the Security Service (MI5) and the Secret Intelligence Service (MI6) in the United Kingdom, and the . The addition of DSL.net's broadband and Voice over IP (VoIP) infrastructure would also give MegaPath greater control over the performance and reliability of its services, and improve its margins and profitability. "This strategic investment gives us the opportunity to accelerate MegaPath's growth and improve its profitability, while also providing us with greater control over the quality of service we offer our customers," said Craig Young Craig Young (born 1957 in Wollongong, New South Wales) was a representative Australian rugby league player for the Australia national rugby league team, the New South Wales Blues and a stalwart player over 11 seasons from 1977 to 1988 with the St. , Chairman and Chief Executive Officer of MegaPath. "We are eager to help DSL.net customers grow their businesses by leveraging our wide array of managed IP services, expanded network reach, and additional operational and engineering resources. Moreover, the combined company would offer the financial strength and market leadership that enterprise customers look for when selecting a service provider to manage their business-critical communications." As the leading IP Managed Service Provider (MSP (1) (Management Service Provider or Managed Service Provider) An organization that manages a customer's computer systems and networks which are either located on the customer's premises or at a third-party datacenter. ) in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. , MegaPath can offer DSL.net customers expanded broadband coverage throughout the U.S. and Canada. MegaPath can also provide a full range of integrated security, IP Telephony The two-way transmission of voice over a packet-switched IP network, which is part of the TCP/IP protocol suite. The terms "IP telephony" and "voice over IP" (VoIP) are synonymous. , remote access and site-to-site IP VPN services to augment the DSL.net services. This acquisition would give MegaPath the broadband facilities and field technicians to deliver these services throughout the Northeast and Mid-Atlantic regions, which have the highest concentration of businesses in the United States. This additional infrastructure should improve MegaPath's profit margins and provide greater control over its costs and service delivery. "DSL.net is known for offering its broadband customers among the highest performance and reliability in the industry, combined with highly innovative service offerings that increase productivity and business profitability," said David Struwas, Chief Executive Officer of DSL.net. "By combining the companies' infrastructure and service offerings, we will be providing customers one of the best networks and the most comprehensive set of managed IP services available anywhere. This is great news for both companies and our customers." DSL.net currently offers services via its own facilities in over 350 collocations in Vermont, New Hampshire New Hampshire, one of the New England states of the NE United States. It is bordered by Massachusetts (S), Vermont, with the Connecticut R. forming the boundary (W), the Canadian province of Quebec (NW), and Maine and a short strip of the Atlantic Ocean (E). , Massachusetts, Connecticut, Pennsylvania, Rhode Island Rhode Island, island, United States Rhode Island, island, 15 mi (24 km) long and 5 mi (8 km) wide, S R.I., at the entrance to Narragansett Bay. It is the largest island in the state, with steep cliffs and excellent beaches. , New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of , New Jersey, Delaware, Maryland, Virginia and Washington, D.C. The associated round of funding includes certain of MegaPath's existing investors, including Fidelity Ventures, Rho Ventures, U.S. Venture Partners, Columbia Capital, Trident Capital and Boston Millennia Partners. MegaPath will use this funding to accelerate the growth of its managed IP service business and expand its portfolio of value-added services organically and through strategic acquisitions. The acquisition is subject to shareholder and regulatory approval; final closing is expected by the end of 2006, however, this date is subject to change. About MegaPath MegaPath is the leading provider of managed IP communications services in North America. MegaPath leverages its wide selection of broadband connectivity, Virtual Private Networks, Voice over IP (VoIP) and security technologies to enable businesses to lower costs, increase security and enhance productivity. Businesses of all sizes can easily and securely communicate between their headquarters, branch offices, retail locations, mobile workers, and business partners. To learn more about why over 18,000 companies have chosen MegaPath's managed IP data, voice and security services to improve their business communications, visit www.megapath.com or call 1-877-MegaPath (638-4342). About DSL.net DSL.net, Inc. is a leading nationwide provider of broadband communications services to businesses. The Company combines its own facilities, nationwide network infrastructure and Internet Service Provider Internet service provider (ISP) Company that provides Internet connections and services to individuals and organizations. For a monthly fee, ISPs provide computer users with a connection to their site (see data transmission), as well as a log-in name and password. (ISP (1) See in-system programmable. (2) (Internet Service Provider) An organization that provides access to the Internet. Connection to the user is provided via dial-up, ISDN, cable, DSL and T1/T3 lines. ) capabilities to provide high-speed Internet access, private network solutions and value-added services directly to small- and medium-sized businesses or larger enterprises looking to connect multiple locations. DSL.net product offerings include T1, DS3 and business-class DSL services, virtual private networks (VPNs), frame relay, Web hosting, DNS (Domain Name System) A system for converting host names and domain names into IP addresses on the Internet or on local networks that use the TCP/IP protocol. For example, when a Web site address is given to the DNS either by typing a URL in a browser or behind the management, enhanced e-mail, online data backup and recovery services, firewalls and nationwide dial-up services, as well as integrated voice and data offerings in select markets. For more information, visit www.dsl.net, www.getduet.com, e-mail info@dsl.net, or call 1-877-DSL-NET1 (1-877- 375-6381). This press release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and, to the extent it does, these forward-looking statements are subject to a variety of risks and uncertainties, many of which are beyond the parties' control, which could cause actual results to differ materially from those contemplated in these forward-looking statements. In particular, the risks and uncertainties associated with DSL.net's business include, among other things, (i) DSL.net's unproven business model, which may not be successful; (ii) regulatory, legislative and judicial developments, which could adversely affect the way DSL.net operates its business or increase its costs of operations; (iii) competition; (iv) DSL.net's ability to recruit and retain qualified personnel; (v) the parties' obtaining of requisite regulatory and shareholder approvals as a predicate In programming, a statement that evaluates an expression and provides a true or false answer based on the condition of the data. to the acquisition described above; (vi) DSL.net's ability to cover any future operating shortfalls, whether through MegaPath's purchase of subsequent note instruments or otherwise, prior to effectuation of the acquisition described above; and (vii) DSL.net's dependence on third-party providers to supply it with local DSL and T-1 facilities in areas where it has not deployed its own equipment. Existing and prospective investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. DSL.net undertakes no obligation, and disclaims any obligation, to update or revise the information contained in this press release, whether as a result of new information, future events or circumstances or otherwise. For additional information regarding these and other risks faced by DSL.net, see the disclosure contained under "Risk Factors'' in DSL.net's Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended December 31, 2005, which has been filed with the Securities and Exchange Commission. DSL.net is a trademark of DSL.net, Inc. Other company names may be trademarks of their respective owners. |
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