Pannaway Technologies Closes Successful Q1 05.

PORTSMOUTH, N.H. -- Quarter Highlighted by New Customer Adoption, Expansion into New Markets, Increased Interest in Primary Line VoIP and Addition to Leadership Team

Pannaway Technologies, Inc., designers and developers of converged IP Ethernet broadband voice, video and data platforms, today announced continued company success and momentum with the close of Q1 2005. Highlights from Pannaway's successful Q1 include new US-based ILEC and CLEC customer wins, expansion into new markets, scheduled International deployments and the strategic hire of a new vice president of business development. Pannaway concluded Q1 with 34 total US-based deployments, including contracted customers and new customer trials. New customers include Coleman County Telecommunications Cooperative, Allendale Communications, Nsight Telservices, Westphalia Broadband, Inc. and Converged Communications. Additionally, Pannaway continues discussions around a Series D round of funding between $10 million and $20 million, which will likely close in Q2 2005.

"Our company is in business to help telcos improve their success and increase profitability through the deployment of currently available and emerging broadband services," said Gary Davis, President of Pannaway. "We are heavily focused on providing quantifiable Return on Investment (ROI) and value to our telco customers through the delivery of a highly manageable suite of fully integrated Ethernet IP access products enabling true Triple Play service delivery - and at a per port cost that is unmatched in the industry."

New Customers:

--Allendale Communications: Based in Allendale, Mich., Allendale Communications selected Pannaway to deliver services to a number of local communities, including Broadband TV and Internet access to 300 off-campus housing units at Grand Valley State University. Pannaway's All-IP Ethernet solution was best equipped to meet the excessive bandwidth demands of their off-campus housing tenants which included the need for four television sets and four DSL connections per household.

--Nsight Telservices: Based in Green Bay, Wisc., Nsight embarked on a 2-year testing period where they evaluated multiple access vendors, ultimately selecting the Pannaway solution based on its ability to deliver high-revenue Triple Play services without forcing the company to forklift upgrade existing infrastructure equipment.

--Westphalia Broadband, Inc., (WBI): Located in Lansing, Mich., WBI selected Pannaway's end-to-end Ethernet IP solution to enhance revenue streams through the delivery of new bundled Triple Play services to an exploding population of new residents and businesses.

--Coleman County Telecommunications Cooperative (CCTC): Located in Santa Anna, Tex., CCTC is launching a suite of new bundled services including VoIP, premium digital television and broadband Internet access to subscribers within six local exchanges. CCTC selected the Pannaway solution based on its ability to deliver Triple Play services over an All-IP infrastructure without the need to forklift upgrade existing equipment.

Pannaway Solves E911 Problem with Innovative Primary Line VoIP(SM)

One significant differentiator for the Pannaway solution is its patent-pending technology in the area of Primary Line VoIP. The Pannaway solution boasts the industry's only SIP-based DSLAM/DLC replacement with support for Primary Line VoIP which includes E-911 support and advanced calling features. Anytime power is lost at the customer premise, the Pannaway Broadband Access Switch (BAS(TM)) detects the loss of the DSL connection and then seamlessly provides phone service to the subscriber without additional battery backup.

"The availability of Primary Line VoIP played an enormous role in our decision to select Pannaway as our primary access solution provider," said Rob Riordan, Executive Vice President and Director of Corporate Development at NSight. "We are committed to providing our customers with the highest quality Triple Play services available today, of which VoIP will be an important component. Delivering a voice service to our customers that could prevent them from dialing Emergency 911 in a time of crisis was simply not acceptable to us."

New VP Business Development to Lead Company into Emerging Markets

Pannaway has a very aggressive customer evaluation deployment schedule through Q2 2005 consisting of 23 US-based sites and five international sites. To meet this schedule, Pannaway's first quarter included the hiring of Mark Carpenter as vice president of business development. Carpenter comes to Pannaway after five years as an executive officer of Tut Systems, in roles spanning vice president of partner development, vice president of marketing and vice president of product development and marketing. Prior to that, he spent three years with Compaq, where he spearheaded the creation of the HomePNA and commercially launched the world's first home networked and broadband connected PCs.

"This is an exciting time to join Pannaway," said Carpenter. "As the market moves towards greater adoption of broadband technologies, Pannaway has a great opportunity to make a lasting mark in the telecommunications landscape with its innovative solution and first-class support organization. I look forward to leveraging my years of experience to help move Pannaway to the next level."

About Pannaway

Pannaway Technologies designs and the industry's first carrier-class end-to-end IP solution for converged voice, video and data service delivery. Pannaway's innovative technology enables telecommunications service providers worldwide to deliver profitable broadband services to homes and businesses at a fraction of their historical costs. The privately held company was founded in April 2002 and is headquartered in Portsmouth, New Hampshire. Its founding management team, with over 90 years of collective experience in the industry, has played a pioneering role in the telecommunications equipment sector. For more information, please visit www.pannaway.com.

About Nsight Telservices

Nsight Telservices is the corporate headquarters for a family of companies providing wireless, business and residential local phone service, long distance, internet, web hosting and tower erection and maintenance services in the Midwest. The list of subsidiaries under Nsight Telservices includes Cellcom, NetNet, Local Nsight, Nsight Long Distance, Northeast Telephone Company, St. Paul Tower and NET Cable.