UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

þ		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number 0-16231

XETA Technologies, Inc.

(Exact name of registrant as specified in its charter)

Oklahoma		73-1130045
(State or other jurisdiction of		(I.R.S. Employee
incorporation or organization)		Identification No.)
1814 W. Tacoma Street, Broken Arrow, OK		74012-1406
(Address of principal executive offices)		(Zip Code)

918-664-8200

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes þ           No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Not applicable þ

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company (as defined by Rule 12b-2 of the Exchange Act).

Large accelerated filer o		Accelerated filer o		Non-accelerated filer o (Do not check if a smaller reporting company)		Smaller reporting company þ

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes o          No þ

As of March 3, 2011 there were 10,779,757 shares of the registrant’s common stock, par value $0.001, outstanding.

 

 

INDEX

		PAGE
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (Unaudited)
Consolidated Balance Sheets — January 31, 2011 and October 31, 2010			3
Consolidated Statements of Operations — For the Three Months Ended January 31, 2011 and 2010			4
Consolidated Statement of Shareholders’ Equity — For the Three Months Ended January 31, 2011			5
Consolidated Statements of Cash Flows — For the Three Months Ended January 31, 2011 and 2010			6
Notes to Consolidated Financial Statements			7
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS			13
ITEM 4. CONTROLS AND PROCEDURES			17
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS			17
ITEM 1A. RISK FACTORS			18
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS			19
ITEM 3. DEFAULTS UPON SENIOR SECURITIES			19
ITEM 5. OTHER INFORMATION			19
ITEM 6. EXHIBITS			20
Exhibit 31.1
Exhibit 31.2
Exhibit 32.1
Exhibit 32.2

XETA TECHNOLOGIES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

		(UNAUDITED)
		January 31, 2011				October 31, 2010
ASSETS
Current assets:
Cash and cash equivalents		$	721,985			$	1,003,180
Current portion of net investment in sales-type leases and other receivables			612,537				996,148
Trade accounts receivable, net			18,328,219				17,805,992
Inventories, net			6,429,522				6,715,076
Deferred tax asset			1,196,966				1,168,544
Prepaid taxes			81,390				69,980
Prepaid expenses and other assets			2,817,373				2,402,111
Total current assets			30,187,992				30,161,031
Noncurrent assets:
Goodwill			18,214,166				17,783,911
Intangible assets, net			2,988,797				3,161,791
Net investment in sales-type leases and other receivables, less current portion above			233,265				326,454
Property, plant & equipment, net			7,570,668				6,931,927
Total noncurrent assets			29,006,896				28,204,083
Total assets		$	59,194,888			$	58,365,114
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt		$	337,500			$	337,500
Revolving line of credit			3,391,918				1,756,361
Accounts payable			7,803,404				10,031,900
Current portion of obligations under capital lease			78,623				122,401
Current unearned services revenue			5,976,995				6,529,330
Accrued liabilities			5,008,328				3,883,303
Total current liabilities			22,596,768				22,660,795
Noncurrent liabilities:
Long-term debt, less current portion above			172,514				255,315
Accrued long-term liability			100,100				144,100
Noncurrent unearned services revenue			37,440				48,629
Noncurrent deferred tax liability			395,945				12,417
Total noncurrent liabilities			705,999				460,461
Contingencies
Shareholders’ equity:
Preferred stock; $.10 par value; 50,000 shares authorized, 0 issued			—				—
Common stock; $.001 par value; 50,000,000 shares authorized, 11,654,071 issued at January 31, 2011 and October 31, 2010			11,653				11,653
Paid-in capital			15,669,918				15,662,689
Retained earnings			22,167,327				21,596,383
Less treasury stock, at cost (891,830 shares at January 31, 2011 and 923,835 shares at October 31, 2010)			(1,956,777	)			(2,026,867	)
Total shareholders’ equity			35,892,121				35,243,858
Total liabilities and shareholders’ equity		$	59,194,888			$	58,365,114

The accompanying notes are an integral part of these consolidated financial statements.

XETA TECHNOLOGIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

		For the Three Months
		Ended January 31,
		2011				2010
Systems sales		$	11,987,842			$	10,867,058
Services			15,296,203				12,116,857
Other revenues			122,317				60,228
Net sales and services revenues			27,406,362				23,044,143
Cost of systems sales			8,945,436				8,076,587
Services costs			11,017,103				8,231,080
Cost of other revenues & corporate COGS			447,841				397,635
Total cost of sales and services			20,410,380				16,705,302
Gross profit			6,995,982				6,338,841
Operating expenses
Selling, general and administrative			5,837,558				5,125,283
Amortization			312,048				186,855
Total operating expenses			6,149,606				5,312,138
Income from operations			846,376				1,026,703
Interest expense			(19,275	)			(6,170	)
Interest and other income			112,843				21,255
Net interest and other income			93,568				15,085
Income before provision for income taxes			939,944				1,041,788
Provision for income taxes			369,000				409,000
Net income		$	570,944			$	632,788
Earnings per share
Basic		$	0.05			$	0.06
Diluted		$	0.05			$	0.06
Weighted average shares outstanding			10,741,534				10,237,405
Weighted average equivalent shares			10,809,696				10,277,361

The accompanying notes are an integral part of these consolidated financial statements.

XETA TECHNOLOGIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY

(UNAUDITED)

		Common Stock								Treasury Stock
		Shares Issued				Par Value				Shares				Amount				Paid-in Capital				Retained Earnings				Total
Balance- October 31, 2010			11,654,071			$	11,653				923,835			$	(2,026,867	)		$	15,662,689			$	21,596,383			$	35,243,858
Issuance of restricted common stock from treasury (net of 7,441 forfeited shares)			—				—				(32,005	)			70,090				(70,090	)			—				—
Stock-based compensation			—				—				—				—				77,319				—				77,319
Net income			—				—				—				—				—				570,944				570,944
Balance- January 31, 2011			11,654,071			$	11,653				891,830			$	(1,956,777	)		$	15,669,918			$	22,167,327			$	35,892,121

The accompanying notes are an integral part of these consolidated financial statements.

XETA TECHNOLOGIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

		For the Three Months
		Ended January 31,
		2011				2010
Cash flows from operating activities:
Net income		$	570,944			$	632,788
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation			428,834				285,801
Amortization			312,048				186,855
Stock-based compensation			70,999				74,060
Provision for returns & doubtful accounts receivable			15,000				15,000
Provision for excess and obsolete inventory			25,500				25,500
Deferred taxes			369,000				409,001
Change in assets and liabilities:
Decrease (increase) in net investment in sales-type leases & other receivables			476,800				(77,062	)
(Increase) decrease in trade accounts receivable			(346,983	)			68,599
Decrease in inventories			298,045				191,797
Increase in prepaid expenses and other assets			(407,587	)			(339,706	)
Increase in prepaid taxes			(11,410	)			(5,295	)
(Decrease) increase in accounts payable			(2,228,496	)			306,130
Decrease in unearned revenue			(787,360	)			(17,022	)
Increase in accrued liabilities			936,976				348,647
Total adjustments			(848,634	)			1,472,305
Net cash (used in) provided by operating activities			(277,690	)			2,105,093
Cash flows from investing activities:
Additions to property, plant & equipment			(1,181,629	)			(206,193	)
Acquisitions, net of cash acquired			(330,854	)			—
Net cash used in investing activities			(1,512,483	)			(206,193	)
Cash flows from financing activities:
Principal payments on debt			(82,801	)			(1,183,475	)
Net proceeds on revolving line of credit			1,635,557				—
Payments on capital lease obligations			(43,778	)			(37,961	)
Net cash provided by (used in) financing activities			1,508,978				(1,221,436	)
Net (decrease) increase in cash and cash equivalents			(281,195	)			677,464
Cash and cash equivalents, beginning of period			1,003,180				4,731,926
Cash and cash equivalents, end of period		$	721,985			$	5,409,390
Supplemental disclosure of cash flow information:
Cash paid during the period for interest		$	25,102			$	13,651
Cash paid during the period for income taxes		$	11,410			$	5,295

The accompanying notes are an integral part of these consolidated financial statements.

XETA TECHNOLOGIES, INC. AND SUBSIDIARIES

(Unaudited)

1. BASIS OF PRESENTATION:

XETA Technologies, Inc. (“XETA”, the “Company”, “we”, “us”, or “our”), an Oklahoma corporation formed in 1981, is a leading provider of advanced communications solutions with nationwide sales and service. We provide a wide variety of applications including voice messaging, wireless voice and data solutions, video applications, contact center solutions, unified communication, and high speed internet access solutions to hospitality and conference center customers. We sell and/or support communications solutions produced by several manufacturers including Avaya, Inc. (“Avaya”), Mitel Corporation (“Mitel”), Samsung Business Communications Systems (“Samsung”), Juniper Networks, Polycom, Microsoft and ShoreTel Corporation (“ShoreTel”).

The Company prepared the accompanying unaudited consolidated financial statements pursuant to the rules and regulations of the Securities and Exchange Commission (the “Commission”). Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to those rules and regulations. The Company believes that the disclosures are reasonably adequate to ensure the information is not misleading. Management suggests that these condensed financial statements be read in conjunction with the consolidated financial statements and the notes thereto made a part of the Company’s Annual Report on Form 10-K. The Company filed the 10-K as Commission File No. 0-16231, with the Commission on January 25, 2011 and subsequently amended on January 28, 2011 and February 25, 2011. Management believes that the financial statements contain the necessary adjustments for a fair statement of the results for the interim periods presented. All adjustments were of a normal recurring nature. The results of operations for the interim period are not necessarily indicative of the results for the entire fiscal year.

Fair Value of Financial Instruments

The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practicable to estimate the value:

The carrying value of cash and cash equivalents, customer deposits, trade accounts receivable, sales-type leases, accounts payable and short-term debt approximate their respective fair values due to their short maturities.

Based upon the borrowing rates currently available to the Company for bank loans with similar terms and average maturities, the fair value of the long-term debt approximates the carrying value.

Segment Information

The Company has three reportable segments: services, commercial system sales, and hospitality system sales. Services revenues represent revenues earned from installing and maintaining systems for customers in both the commercial and hospitality segments. The Company defines commercial system sales as sales to the non-hospitality industry.

The reporting segments follow the same accounting policies used for the Company’s consolidated financial statements and are described in the Summary of Significant Accounting Policies in the Company’s Form 10-K described above. Company management evaluates a segment’s performance based on gross margins. Assets are not allocated to the segments. Sales outside of the U.S. are immaterial.

The following is a tabulation of business segment information for the three months ended January 31, 2011 and 2010:

						Commercial				Hospitality
		Services				Systems				Systems				Other
		Revenues				Sales				Sales				Revenue				Total
2011
Sales		$	15,296,203			$	9,711,076			$	2,276,766			$	122,317			$	27,406,362
Cost of sales			(11,017,103	)			(7,417,096	)			(1,528,340	)			(447,841	)			(20,410,380	)
Gross profit		$	4,279,100			$	2,293,980			$	748,426			$	(325,524	)		$	6,995,982
2010
Sales		$	12,116,857			$	10,038,581			$	828,477			$	60,228			$	23,044,143
Cost of sales			(8,231,080	)			(7,540,985	)			(535,602	)			(397,635	)			(16,705,302	)
Gross profit		$	3,885,777			$	2,497,596			$	292,875			$	(337,407	)		$	6,338,841

Stock-Based Compensation Plans

The Company applies the provisions of ASC 718, “Compensation — Stock Compensation”, which requires companies to measure all employee stock-based compensation awards using a fair value method and recognize compensation cost in its financial statements. The Company recognizes the fair value of stock-based compensation awards as selling, general and administrative expense in the consolidated statements of operations on a straight-line basis over the vesting period. Compensation expense was recognized in the statements of operations as follows:

		2011				2010
Three months ended January 31,		$	70,999			$	74,060

Use of Estimates

The preparation of the financial statements conforms to the accounting principles generally accepted in the U.S., and requires management to make estimates and assumptions affecting the reported amounts of assets and liabilities: disclosure of contingent assets and liabilities at the date of the financial statements; and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from these estimates.

New Accounting Pronouncements

In December 2010 the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2010-29, “Business Combinations (Topic 805): Disclosure of Supplementary Pro Forma Information for Business Combinations”. ASU 2010-29 requires that if comparative financial statements are presented, the company disclose revenue and earnings of the combined entity as though the business combination had occurred as of the beginning of the comparable prior annual reporting period only. ASU 2010-20 also expands the supplemental pro forma disclosures to include a description and amount of material, nonrecurring pro forma adjustments that are attributable to the business combination. ASU 2010-29 will be effective for fiscal years beginning after December 15, 2010. The Company will apply the guidance to material business combinations after adoption.

In December 2010 the FASB issued ASU 2010-28, “Intangibles — Goodwill and Other (Topic 350): When to Perform Step 2 of the Goodwill Impairment Test for Reporting Units with Zero or Negative Carrying Amounts”. ASU 2010-28 modifies Step 1 of the goodwill impairment test for reporting units with zero or negative carrying amounts by requiring an entity to perform Step 2 of the goodwill impairment test if it is more likely than not that a goodwill impairment exists. This update will be effective for fiscal years beginning after December 15, 2010. The adoption of this guidance is not expected to have a material impact on the Company’s consolidated financial statements.

In July 2010 the FASB issued ASU 2010-20, “Receivables (Topic 310): Disclosure about the Credit Quality of Financing Receivables and the Allowance for Credit Losses”. ASU 2010-20 requires disclosures designed to enhance transparency regarding credit losses and the credit quality of loan and lease receivables. Disclosures include an evaluation of the nature of credit risk inherent in the entity’s financing receivables; how the risk is analyzed to arrive at the allowance for credit losses and the changes and reasons for changes in the allowance for credit losses. Under this guidance, the allowance for credit losses and fair value are to be disclosed by portfolio segment. The adoption of this guidance did not have a material impact on the Company’s consolidated financial statements.

In October 2009 the FASB issued ASU 2009-13, “Revenue Recognition — Multiple-Deliverable Revenue Arrangements”. The guidance in ASU 2009-13 amends the criteria for separating consideration in multiple-deliverable arrangements. The guidance eliminates the estimated fair value approach for revenue allocation between the separate units of accounting and replaces it with a sales-based approach referred so as the relative-selling-price method. ASU 2009-13 expands required disclosures related to a company’s multiple-deliverable revenue arrangements. The adoption of this guidance did not have a material impact on the Company’s consolidated financial statements.

Other accounting standards that have been issued or proposed that do not require adoption until a future date are not expected to have a material impact on our consolidated financial statements upon adoption.

2. ACCOUNTS RECEIVABLE:

Trade accounts receivable consist of the following:

						(Audited)
		January 31,				October 31,
		2011				2010
Trade accounts receivable		$	18,899,562			$	18,352,519
Less- reserve for doubtful accounts			(571,343	)			(546,527	)
Net trade accounts receivable		$	18,328,219			$	17,805,992

On January 14, 2009, Nortel Networks Corporation filed for bankruptcy protection in the United States Bankruptcy Court for the District of Delaware. Subsequent to the filing the administrators of the bankruptcy adopted a business disposal strategy. Under the strategy, the administrators segmented Nortel into three primary business units: Virtual Service Switches, CDMA businesses and Enterprise Solutions. We conducted all of our Nortel business through the Enterprise Solutions unit which was purchased by Avaya in December 2009.

Nortel owes XETA approximately $700,000 in pre-petition accounts receivable. On July 17, 2009 the bankruptcy court granted XETA’s request for offset of $116,000 in charges owed to Nortel at the time of the filing. In fiscal year 2009, the Company recorded $350,000 as a reserve against possible Nortel bad debts. Nortel filed its plan of reorganization on July 12, 2010 (the “Nortel Plan”). XETA’s claim is classified as a Class 3 claim, “General Unsecured Claims”. The Nortel Plan states that priority non-tax claims and secured claims will be paid in full, but that Class 3 claims will be impaired. No indication or estimate is given as to the potential extent of the impairment. According to the Nortel Plan, XETA and other Class 3 claimants will receive a pro rata share of the assets of Nortel at the time the Nortel Plan goes into affect but the Administrator has provided no guidance as to an expected payout level. Based on the information presently available, the Company can make no further determination regarding the adequacy of its reserve in this matter. The Company will continue to carefully follow developments associated with the bankruptcy case and will assert its legal rights and defenses as appropriate.

3. INVENTORIES:

Inventories are stated at the lower of average cost or market and consist of the following:

						(Audited)
		January 31,				October 31,
		2011				2010
Finished goods and spare parts		$	7,546,349			$	7,785,951
Less- reserve for excess and obsolete inventories			(1,116,827	)			(1,070,875	)
Total inventories, net		$	6,429,522			$	6,715,076

4. PROPERTY, PLANT AND EQUIPMENT:

Property, plant and equipment consist of the following:

		Estimated						(Audited)
		Useful		January 31,				October 31,
		Lives		2011				2010
Building and building improvements		3-20		$	3,420,231			$	3,379,059
Data processing and computer field equipment		2-7			4,917,782				4,438,556
Software development costs, work-in-process		N/A			98,067				272,097
Software development costs of components placed into service		3-10			2,929,244				2,731,310
Hardware		3-5			643,635				643,635
Land		—			611,582				611,582
Office furniture		5-7			944,493				880,635
Autos		5			710,608				710,608
Other		3-7			754,600				156,131
Total property, plant and equipment					15,030,242				13,823,613
Less- accumulated depreciation and amortization					(7,459,574	)			(6,891,686	)
Total property, plant and equipment, net				$	7,570,668			$	6,931,927

5. INCOME TAXES:

The tax provision reflects the effective Federal tax rate plus the composite state income tax rates adjusted for states that require minimum tax payments even if tax losses are incurred. Generally, we expect our tax provision rate to be approximately 40%.

6. CREDIT AGREEMENTS:

At January 31, 2011 the Company’s credit facility consisted of a loan agreement with a commercial bank including a $8.5 million revolving credit agreement collateralized by trade accounts receivable, inventories, and real estate. The facility matures on November 5, 2011. Advance rates are defined in the agreement, but are generally at the rate of 75% on qualified trade accounts receivable and 50% of qualified inventories and real estate. The credit facility contains several financial covenants common in such agreements including tangible net worth requirements, limitations on the amount of funded debt to annual earnings before interest, taxes, depreciation and amortization, limitations on cash dividends, and debt service coverage requirements. Interest on the loan agreement accrues at the greater of either a) the London Interbank Offered Rate (“LIBOR”) (0.26% at January 31, 2011) plus 3.00% or b) 4.5%. The outstanding balance on the revolving line of credit was $3.4 million at January 31, 2011. At January 31, 2011 we were in compliance with the covenants of the credit facility.

At January 31, 2011 the Company was paying 4.5% on the revolving line of credit borrowings.

On August 2, 2010 the Company purchased the common stock of Pyramid Communications Services, Inc. The purchase price included subordinated promissory notes payable to the sellers in quarterly installments through July 31, 2012 bearing interest at 3% per year. At January 31, 2011 the total notes payable was $510,000. We reduced our balance through scheduled principal payments by $83,000 in the first quarter of fiscal 2011.

7. EARNINGS PER SHARE:

The Company computes basic earnings per common share by dividing net income by the weighted average number of shares of common stock outstanding during the reporting periods. Dividing net income by the weighted average number of shares of common stock and dilutive potential common stock outstanding during the reporting periods computes diluted earnings per common share. A reconciliation of net income and weighted average shares used in computing basic and diluted earnings per share is as follows:

		For the Three Months Ended January 31, 2011
		Income				Shares				Per Share
		(Numerator)				(Denominator)				Amount
Basic EPS
Net income		$	570,944				10,741,534			$	0.05
Dilutive effect of stock options							68,162
Diluted EPS
Net income		$	570,944				10,809,696			$	0.05

		For the Three Months Ended January 31, 2010
		Income				Shares				Per Share
		(Numerator)				(Denominator)				Amount
Basic EPS
Net income		$	632,788				10,237,405			$	0.06
Dilutive effect of stock options							39,956
Diluted EPS
Net income		$	632,788				10,277,361			$	0.06

Options to purchase 715,500 shares of common stock at an average exercise price of $4.71 and 993,438 shares of common stock at an average exercise price of $6.63 were not included in the computation of diluted earnings per share for the three months ended January 31, 2011 and 2010, respectively, because inclusion of these options would be antidilutive.

8. CAPITAL LEASES:

During 2008 the Company leased software licenses under an agreement that is classified as a capital lease. The book value of the licenses is included in the balance sheet as property, plant, and equipment and was $63,406 at January 31, 2011. Accumulated amortization of the licenses at January 31, 2011 was $393,114. Amortization of assets under the capital lease is included in depreciation expense. As of January 31, 2011 the future minimum lease payments required under the lease is $67,265 and the present value of the net minimum lease payments is $66,618. At January, 31, 2011 future minimum lease payments required under a vehicle lease assumed in a recent acquisition is $12,410 and the present value of the lease payments is $12,005.

9. ACQUISITIONS:

On November 19, 2010, the Company completed the purchase of certain operating assets of New Vision Comunications, Inc., (“New Vision”) a privately-held company based in Omaha, Nebraska providing communications equipment and related services. The purchase price included $331,000 paid in cash at closing and a hold-back of $45,000 to be paid to the seller subject to reductions related to the final value of the net assets purchased.

The fair values of the assets acquired and liabilities assumed for New Vision are provisional and are based on the information available as of the acquisition date. The Company believes that the information available provides a reasonable basis for estimating the fair value but additional information may be necessary to finalize the valuation. The provisional measurements of fair value are subject to change. The Company expects to finalize the valuation and complete the purchase price allocation as soon as practicable but no later than one year from the acquisition date.

10. SUBSEQUENT EVENT:

On February 8, 2011, the Company entered into a merger agreement with PAETEC Holding Corp., a Delaware corporation (“PAETEC”), and Hera Corporation, an Oklahoma corporation and an indirect wholly-owned subsidiary of PAETEC (“Hera”). Under the terms and subject to the conditions of the Merger Agreement, Hera will merge with and into XETA (the “Merger”), with XETA surviving the Merger as an indirect wholly-owned subsidiary of PAETEC. The Merger Agreement has been approved unanimously by the board of directors of each of XETA and PAETEC.

At the effective time of the Merger, each share of XETA common stock issued and outstanding immediately prior to the effective time (other than shares held in the treasury of XETA or any subsidiary of XETA and any shares owned by PAETEC or any of its subsidiaries) will be automatically converted into the right to receive $5.50 in cash, without interest (the “Merger Consideration”). In addition, immediately prior to the effective time of the Merger, all remaining forfeiture restrictions applicable to restricted shares of XETA common stock will expire and the holders thereof will be entitled to receive the Merger Consideration with respect to each such share. Certain options to purchase shares of XETA common stock outstanding immediately prior to the effective time shall become fully vested immediately prior to the effective time. Holders of warrants and vested options will be entitled to receive (in each case, in accordance with the terms of their respective plans and agreements) the product of (i) the number of shares of XETA common stock that would have been acquired upon the exercise of the stock option or warrant, multiplied by (ii) the excess, if any, of the Merger Consideration over the exercise price to acquire a share of XETA common stock under such option or warrant. The Merger Consideration will be approximately $61 million in the aggregate.

The consummation of the Merger is subject to customary conditions, including, without limitation, (a) approval by the holders of a majority of the outstanding shares of XETA’s common stock entitled to vote on the Merger, (b) receipt of any required antitrust or regulatory approvals (including, if applicable, the expiration or termination, as the case may be, of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976), and (c) the absence of any law, regulation, order or injunction prohibiting the Merger. Moreover, each party’s obligation to consummate the Merger is subject to certain other conditions, including, without limitation, (i) the accuracy of the other party’s representations and warranties (subject to customary materiality qualifiers and other qualifying disclosures which are not necessarily reflected in the Merger Agreement), (ii) the other party’s compliance with its covenants and agreements contained in the Merger Agreement, (iii) there not being holders of more than 15% of the outstanding shares of XETA common stock properly exercising appraisal rights and (iv) there not having been a material adverse effect on the business, financial condition or results of operations of XETA and its subsidiaries (subject to certain limitations) or the ability of XETA to consummate the transactions under the Merger Agreement that has not been cured.

The Merger Agreement contains customary representations, warranties and covenants of XETA, PAETEC and Acquisition Sub, including, among others, covenants by XETA to conduct its business in the ordinary course during the interim period between the execution of the Merger Agreement and consummation of the Merger and not to engage in certain types of transactions during such period.

On February 14 and 16, 2011, three separate putative stockholder class action complaints were filed in the District Court of Tulsa County, State of Oklahoma against the Company, the members of our board of directors, and PAETEC Holding Corp. (“PAETEC”) and its indirect subsidiary Hera Corporation (“Hera”). The lawsuits concern the proposed merger with PAETEC, and generally assert claims alleging, among other things, that each member of our board of directors breached his fiduciary duties by agreeing to the terms of the merger and by allegedly failing to provide stockholders with material information related to the proposed merger; and that PAETEC and Hera aided and abetted the alleged breaches of fiduciary duty by the members of the Company’s board of directors. The lawsuits seek, among other things, class action certification and monetary and injunctive relief. The Company believes that all claims asserted in the lawsuits are without merit and are merely opportunistic.

ITEM 2.		MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Preliminary Note Regarding Forward-Looking Statements

This report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, relating to future events and our future performance and results. Many of these statements appear in the discussions under the headings “Risk Factors,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” All statements other than those that are purely historical may be forward-looking statements. Forward-looking statements can generally be identified by words such as “expects,” “anticipates,” “may,” “likely,” “plans,” “believes,” “intends,” “projects,” “estimates,” and similar words or expressions. Forward-looking statements are not guarantees of performance, but rather reflect management’s current expectations, estimates, and forecasts about the industry and markets in which we operate, and our assumptions and beliefs based upon information currently available to management. Investors are cautioned that all forward-looking statements are subject to certain risks and uncertainties which are difficult to predict or which we are unable to control, and that could cause actual results to differ materially from those projected, including but not limited to such factors as failure to obtain shareholder approval or failure to satisfy other conditions required for the consummation of the pending merger; failure or delay in consummation of the pending merger for other reasons; changes in laws or regulations; the condition of the U.S. economy and its impact on capital spending in our markets; the successful integration of recently acquired businesses into ours and realization of anticipated synergies and growth opportunities from these transactions; changes in Avaya’s marketing and dealer channel strategy; unpredictable quarter to quarter revenues; continuing success of our Mitel product and service offerings; our ability to maintain and improve upon current gross profit margins; intense competition and industry consolidation; dependence upon a few large wholesale customers for the recent growth in our Managed Services offering; and the availability and retention of revenue professionals and certified technicians. These and other risks and uncertainties are discussed under the heading “Risk Factors” under Part I of the Company’s Form 10-K for the fiscal year ended October 31, 2010 (filed with the Commission on January 25, 2011 and amended on January 28, 2011 and February 25, 2011) and in updates to such risk factors set forth in Item 1A of Part II of this quarterly report.

Overview

PAETEC Merger.

On February 8, 2011 we entered into a merger agreement with PAETEC Holding Corp., a Delaware corporation (“PAETEC”), and Hera Corporation, an Oklahoma corporation and an indirect wholly-owned subsidiary of PAETEC (“Hera”). Under the terms and subject to the conditions of the Merger Agreement, Hera will merge with and into XETA (the “Merger”), with XETA surviving the Merger as an indirect wholly-owned subsidiary of PAETEC. Our shareholders will receive $5.50 in cash for each share of stock held upon approval of the merger by our shareholders. Additional terms and conditions of the proposed merger are provided in Note 10 to the Condensed Consolidated Notes to Financial Statements above.

PAETEC offers a comprehensive suite of IP, voice, data, and Internet services, as well as enterprise communications management software, network security solutions, CPE, and managed services. We will become a part of PAETEC’s managed services portfolio which consists of a wide variety of products including hosted services, service lifecycle management software, and Allworx IP-PBX’s. These managed services can be sold on a stand-alone basis, but is often bundled with a variety of PAETEC’s network services to drive more revenues and deeper relationships with customers.

The Merger is expected to close in the third fiscal quarter. The merger agreement includes covenants by us to conduct business in the ordinary course during the interim period between the execution of the Merger Agreement and consummation of the Merger and not to engage in certain types of transactions during such period. Additionally, while integration planning is ongoing during this period, none of our operations can be integrated into PAETEC’s prior to the closing of the transaction. As a result of these factors, we are operating in a manner consistent with previously stated strategic, financial and operating goals.

Strategy.

To adjust to market conditions and to improve the profitability and predictability of our business, we are continuing to shift our go-to-market strategy from an equipment-centric model to a customer-centric model through the addition of new professional and managed services offerings and through adding new relationships with manufacturers. Additionally, we expect to continue to augment our organic growth through acquisitions and other corporate development activities.

Historically, our revenues have been closely associated with a few major vendors such as Avaya, Nortel, and Hitachi. Our strategy to increase our services revenues coupled with rapid changes in our market requires us to diversify our relationships to more manufacturers as well as develop new customer relationships, particularly related to our managed services business. As a result, in the last two years we have expanded our relationships with manufacturers from five to seventeen, greatly increasing the number of hardware and software applications we sell. We have also expanded our service offerings to include more data-centric services such as managed network services, hospitality guest support services (help desk), wireless long-range bridging, data security consulting, and environment virtualization. These changes are creating opportunities for us to earn additional revenues from existing customers as well as create opportunities with new customers. We believe these expanded capabilities will lead to improved predictiablitily and profitability in our business and will help to diversify our revenues.

In fiscal 2010, we initiated a corporate development effort to identify and make investments which create rapid scale and scope to our business. As a result of those efforts we completed the acquisition of three companies and absorbed the operating assets of a fourth business unit which was being dissolved by its owner. These acquisitions provided: (i) new geographic presence for us in the northeastern and southwestern regions of the country; (ii) new high speed product and service offering for our hospitality vertical market; and (iii) personnel and applications to launch our new network operations center. We expect to continue to use cash flows and debt financing to further these corporate development activies in fiscal 2011.

On November 19, 2010, we completed the purchase of certain operating assets of New Vision Comunications, Inc. (“New Vision”), a privately-held company based in Omaha, Nebraska providing communications equipment and related services. The terms of the purchase agreement are described in Note 9 of the Notes to Consolidated Financial Statements.

Operating Summary.

In the first quarter of fiscal 2011, we recorded net income of $571,000 on revenues of $27.4 million compared to net income of $633,000 on revenues of $23.0 million in the first quarter of last year. The 2011 results primarily reflect an increase in revenues and gross profits offset by increased selling, general and administrative costs, including $324,000 in costs associated with the PAETEC merger process and other corporate development activities. We discuss this and other contributing factors in more detail under “Results of Operations” below.

Financial Position Summary.

Since October 31, 2010, our working capital position remained relatively unchanged at $7.6 million. Cash from operations and net borrowing on the revolving line of credit was primarily used to reduce accounts payable, make capital expenditures to support our operations and purchase the net operating assets of New Vision. We discuss these and other financial items in more detail under “Financial Condition” below.

The following discussion presents additional information regarding our financial condition and results of operations for the three-month periods ended January 31, 2011 and 2010 and should be considered in conjunction with our above comments as well as the “Risk Factors” section below.

Financial Condition

At January 31, 2011 our working capital was $7.6 million compared to $7.5 million at October 31, 2010. We used our cash balances and $1.6 million short-term borrowings from our $8.5 million line of credit to fund our operating activities, acquisition activities and capital expenditures during the quarter.

Our capital expenditures in the first quarter were $1.2 million which included approximately $688,000 in expenditures to build our new network operations center (“NOC”) in Hazelwood, Missouri. The NOC facility provides a platform for a variety of new revenue streams including proactive network monitoring, remote break/fix of network devices, and help desk services. The expenditures above included remodeling a small area in our headquarters facility to create redundancy for the NOC. We used cash of $331,000 to purchase the net operating assets of New Vision. This small acquisition provides us with new personnel and applications to integrate Microsoft applications more effectively with other products and applications we sell. The remaining capital expenditures made in the first quarter were for implementation of a CRM tool to increase our sale management capabilities and to support normal replacement cycles of technology infrastructure.

At January 31, 2011, our cash balance was $722,000 and we had a $3.4 million outstanding balance on our line of credit. In accordance with the collateral base defined in the credit facility, $5.1 million was available for borrowing on the facility at the end of the quarter. At January 31, 2011, we were in compliance with the covenants of the credit facility.

Results of Operations

In the first quarter of fiscal 2011 revenues were $27.4 million compared to $23.0 million in the first quarter 2010. Our net income in the first quarter of fiscal 2011 was $571,000, compared to a net income of $633,000 in the same quarter a year ago. Our 2011 results include $324,000 in professional fees associated with the process which led to the merger agreement with PAETEC as well as other corporate development activities. Without these costs, our net income would have been $769,000 in the first quarter of fiscal 2011, a 21% increase over the first quarter of fiscal 2010. The narrative below provides further explanation of these results.

Systems Sales.

In the first quarter of fiscal 2011 systems sales increased approximately $1.1 million or 10% compared to the same period last year. This increase includes a $1.4 million or 175% increase in sales of systems to hospitality customers and a $328,000 or 3% decrease in sales of systems to commercial customers. The increase in our hospotitality systems sales reflects a modest rebound in that market sector and a large sale of voice and data equipment to a UK-based hospitality location in the first quarter. This sale was made possible as a result of the acquisition of Lorica in fiscal 2010 and will generate recurring network monitoring fees through our new NOC once installation is complete in fiscal 2011. The decrease in sales of systems to commercial customers reflects continued softness in the overall economy coupled with shipping delays by Avaya. Orders affected by these delays are expect to ship in our second fiscal quarter.

Services Revenues.

Services revenues consist of the following:

		For the Three Months Ended
		January 31,
		2011				2010
Maintenance & repair		$	10,283,000			$	7,498,000
Implementation			4,108,000				3,762,000
Structured cabling			905,000				857,000
Total Services revenues		$	15,296,000			$	12,117,000

Maintenance and repair revenues increased 37% in the first quarter. This increase reflects the continued success of our wholesale services programs and repair revenues as well as the addition to our base of maintenance customers associated with acquisitions in the third and fourth quarters of fiscal 2010. We continue to aggressively market our national service footprint and multi-product line technical capabilities to existing and potential wholesale service partners such as network service providers, and large voice and data integrators. We also continue to market our service capabilities to end-users. We expect growth in these programs to positively impact our maintenance and repair revenues for the foreseeable future.

Implementation revenues increased 9% in the first fiscal quarter reflecting an increase in installation revenues and relatively flat revenues from our Professional Services Organization (“PSO”). In the near term, Implementation revenues will continue to be closely aligned with the sale of new systems. From a long term perspective, we are expanding and diversifying our service offerings to a more data- and consulting-centric model. The recent construction of the NOC to provide proactive data and voice network monitoring and help desk services is a direct outcome of our strategy to become more relevant to the needs of CIO’s and reduce our dependency on systems sales to drive implementation and PSO revenues.

Cabling revenues increased 6% in the first fiscal quarter of 2011.

Gross Margins.

The table below presents the gross margins earned on our primary revenue streams:

		For the Three
		Months Ended
		January 31,
Gross Margins		2011				2010
Systems sales			25.4	%			25.7	%
Services revenues			28.0	%			32.1	%
Other revenues			48.7	%			19.3	%
Corporate cost of goods sold			-1.4	%			-1.5	%
Total			25.5	%			27.5	%

Gross margins on systems sales in the first quarter are above our target of 23% to 25% for systems revenues. While we experience a wide range of gross margins on individual systems sales, our consistent overall performance above our expected targets in this area is due to disciplined pricing practices and pricing support received from our manufacturers in the form of project-specific discounts and incentive rebates which are recorded as reductions to cost of goods sold. These discounts and incentives are material to our gross margins. Despite our success in maintaining our equipment margins within or exceeding our targets, we continue to believe we will face increasing pressure on these margins as our market evolves.

Our service margins declined in the first quarter due to uneven distribution of implementation revenues during the quarter, the short-term impact of the start-up of our network operations center, and general inefficiencies from integrating newly acquired operations into our existing systems and processes. Revenues earned from implementation of new systems was weak in the second half of the quarter resulting in lower margins due to the fixed cost structure of this portion of our business. We took steps to address the inefficiencies in our service delivery model in the first quarter as we continued to integrate the operations of the fiscal 2010 acquisitions. These steps included some reductions in technical force where there was overlap with legacy operations. We expect steady improvement of these issues throughout fiscal 2011 as integration efforts continue.

The final components of our gross margins are the margins earned on other revenues and our corporate cost of goods sold. We earn the majority of other revenues from the sale of Avaya maintenance contracts on which we earn either a commission or gross profit. We have no continuing service obligation associated with these revenues and gross profits. This is an unpredictable revenue stream that depends on the expiration dates of existing contracts, installation dates of new systems, customer type as defined by Avaya, and number of years that customers contract for services. These revenues increased by $62,000 or 103% in the first quarter of fiscal 2011 compared to the prior year. Despite this increase, these results were lower than our expectation as many customers have delayed decisions regaring long-term Avaya service contracts until there is more clarity regarding Avaya’s product and service strategies. These revenues vary in both sales volume and gross margins earned. Corporate cost of goods sold represents our material logistics and purchasing functions that support all of our revenue segments.

Operating Expenses.

Our total operating expenses in the first quarter were $6.1 million or 22.4% of revenues compared to $5.3 million or 23.1% of revenues in the first quarter of fiscal 2010. The modest improvement in operating expenses as a percent of revenues was realized despite $324,000 in non-recurring expenses for professional fees and other costs related to the PAETEC merger and other corporate development activities. These expenses included professional fees such as investment banking and legal fees, tax services, and travel costs directly associated with integration activities.

Interest Expense and Other Income.

Net interest and other income was $94,000 in the first quarter of fiscal 2011 compared to $15,000 in net other income in the first quarter of fiscal 2010.

Tax Provision.

The tax provision reflects the effective Federal tax rate plus the composite state income tax rates adjusted for states that require minimum tax payments even if tax losses are incurred. Generally, we expect our tax provision rate to be approximately 40%.

ITEM 4.		CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures. Based on an evaluation conducted as of January 31, 2011 by our management, including our Chief Executive Officer (“CEO”) and our Chief Financial Officer (“CFO”), our CEO and CFO have concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) are effective to reasonably ensure that information required to be disclosed in reports that we file or submit under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to our management, including the CEO and CFO, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Controls. There were no changes in our internal controls during the last fiscal quarter that have materially affected, or are reasonably likely to materially affect, these controls over financial reporting.

PART II. OTHER INFORMATION

ITEM 1.		LEGAL PROCEEDINGS.

On February 14 and 16, 2011, three separate putative stockholder class action complaints were filed in the District Court of Tulsa County, State of Oklahoma against the Company, the members of our board of directors, and PAETEC Holding Corp. (“PAETEC”) and its indirect subsidiary Hera Corporation (“Hera”). The lawsuits concern the proposed merger between us and PAETEC, and generally assert claims alleging, among other things, that each member of our board of directors breached his fiduciary duties by agreeing to the terms of the merger and by allegedly failing to provide stockholders with material information related to the proposed merger; and that PAETEC and Hera aided and abetted the alleged breaches of fiduciary duty by the members of our board of directors. The lawsuits seek, among other things, class action certification and monetary and injunctive relief. We believe that all claims asserted in the lawsuits are without merit and are merely opportunistic.

ITEM 1A.		RISK FACTORS.

The information presented below is an update to the “Risk Factors” included in the Company’s Annual Report on Form 10-K for the fiscal year ended October 31, 2010 and should be read in conjunction therewith. Except as set forth below, the Risk Factors included in the Company’s Form 10-K for its 2010 fiscal year have not materially changed.

The proposed merger with PAETEC is subject to satisfaction or waiver of certain customary conditions, including the approval of the merger by our stockholders.

Until all conditions to the merger agreement are satisfied, we cannot be certain that the proposed merger will close. We will incur significant transaction costs relating to the proposed merger, whether or not the merger is completed. Completion of the merger is subject to the satisfaction or waiver of certain customary conditions set forth in the merger agreement, including without limitation the approval of the merger agreement by our stockholders, receipt of any required antitrust approvals (or termination or expiration of applicable waiting periods), the accuracy of the representations and warranties of the parties and compliance by the parties with their respective obligations under the merger agreement. The transaction is expected to close in the third quarter of fiscal 2011. However, no assurances can be given that the transaction contemplated by the merger agreement will be consummated or, if not consummated, that we will enter into a comparable or superior transaction with another party.

Our future business and financial position may be adversely affected if the merger is not completed.

If the merger agreement with PAETEC is terminated and the merger is not consummated, we will have incurred substantial expenses without realizing the expected benefits of the merger. In addition, we may also be subject to additional risks including, without limitation:

	•		upon termination of the merger agreement under specified circumstances, we may be required to pay PAETEC a termination fee of $1.92 million;
	•		substantial costs related to the merger, such as legal, accounting and financial advisory fees, must be paid regardless of whether the merger is completed; and
	•		potential disruption to the current plan, operations, businesses and distraction of our workforce and management team.

Litigation related to the Merger could adversely affect our financial results.

Several putative stockholder class action complaints were filed against us, the members of our board of directors, and PAETEC in connection with the proposed merger. The cost of defending such lawsuits and paying any judgment or settlement in connection therewith could have an adverse impact on our financial results in the event these amounts exceed our insurance limits or are not covered by those limits.

The proposed merger creates unique risks in the time leading up to closing, and there are also risks of completing the conditions to closing.

The merger agreement generally requires us to operate our business in the ordinary course pending consummation of the proposed merger, but restricts us, without PAETEC’s consent, from taking certain specified actions until the merger is complete or the merger agreement is terminated. Additionally, matters relating to the merger may require substantial commitments of time and resources, which could otherwise have been devoted to other beneficial opportunities. There may also be potential difficulties in employee retention pending consummation of the merger. Any loss of business opportunities or key personnel could have an adverse impact on future business, and, as a result, result in lower future sales and earnings.

If we are unable to complete our proposed merger our stock price could suffer.

The termination of the merger agreement would likely result in a decline in our stock price to the extent that our stock price reflects a market assumption that we will complete the merger and our stockholders will receive the merger consideration specified in the merger agreement.

Nortel’s Chapter 11 Bankruptcy filing and subsequent sale of its enterprise solution business to Avaya may negatively impact our revenues and/or financial condition.

Nortel filed a voluntary petition for Chapter 11 bankruptcy protection on January 14, 2009. On July 12, 2010 Nortel filed its plan of reorganization which was essentially a plan of liquidation. This matter poses a variety of risks to our business, as follows:

	•		Uncertainty surrounding Nortel’s bankruptcy has significantly dampened demand for equipment in this product line as existing Nortel customers evaluate costs and risks associated with maintaining their commitment to the Nortel platform and the associated Avaya product roadmap versus transitioning their installed based to other manufacturers’ platform.
	•		We are owed approximately $717,000 in pre-petition accounts receivable less approximately $116,000 in approved offsets for amounts we owed to Nortel at the time of the filing. Nortel’s July 12 filing classifies our claim as a Class 3 “General Unsecured” claim. As such, our claim will be impaired and any distribution made by Nortel to Class 3 unsecured creditors will be shared among such creditors on a pro-rata basis. We do not know the extent to which this receivable will be impaired but it is apparent we will not collect the full amount. If this claim is not collectible in large part, we could experience material, negative operating results in the near term.
	•		Avaya’s purchase of the Nortel enterprise solution business (“NES”) may result in a significant disruption and/or material decline in our revenues and gross profits. NES is both one of our major suppliers and is an important customer in that NES outsources significant volumes of service calls to us under various managed services programs that NES has with end-user customers. Avaya and NES are large, complex companies with global operations. They have had very different marketing strategies and both have long, deep cultural traditions. The integration of these two companies will be challenging and disruptive to the market. There can be no assurance given that the combination of Avaya and NES will not have near-term and/or long-term material, negative impact on our operating results, financial position, market position, and overall reputation.

ITEM 2.		UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

None.

ITEM 3.		DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 5.		OTHER INFORMATION.

None.

ITEM 6.		EXHIBITS.

Exhibits (filed herewith):

SEC Exhibit No.				Description
	2.1			Agreement and Plan of Merger among PAETEC Holding Corp., Hera Corporation and XETA Technologies, Inc. dated Feburary 8, 2011 (incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K filed with the U. S. Securities and Exchange Commission on February 10, 2011).
	3.1			Amendment to Section 2.1 of the Company’s Amended and Restated Bylaws (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the U.S. Securities and Exchange Commission on February 10, 2011)
	31.1			Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer
	31.2			Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer
	32.1			Certification of Chief Executive Officer Pursuant to Title 18, United States Code, Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
	32.2			Certification of Chief Financial Officer Pursuant to Title 18, United States Code, Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

EXHIBIT INDEX

SEC Exhibit No.				Description
	2.1			Agreement and Plan of Merger among PAETEC Holding Corp., Hera Corporation and XETA Technologies, Inc. dated Feburary 8, 2011 (incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K filed with the U. S. Securities and Exchange Commission on February 10, 2011).
	3.1			Amendment to Section 2.1 of the Company’s Amended and Restated Bylaws (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the U.S. Securities and Exchange Commission on February 10, 2011)
	31.1			Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer
	31.2			Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer
	32.1			Certification of Chief Executive Officer Pursuant to Title 18, United States Code, Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
	32.2			Certification of Chief Financial Officer Pursuant to Title 18, United States Code, Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.