As part of the restructuring plan, Pandatel will consolidate its German operations from 3 locations to 1 in order to decrease operating cost. Upon shareholder approval, Pandatel will move its headquarters from Hamburg to Hanover where Pandatel has already its main team of engineers focused on Ethernet products. The current headquarters in Hamburg will be shutdown and key engineers will be offered to work in Hanover to be part of the R&D team.
Pandatel's current Lightmaze division in Eisingen (Würzburg) will also be shutdown and key engineers transferred to Hanover as well to continue the development and support of its YUMIX optical networking products.

Upon the completion of the restructuring, total number of Pandatel employees in Germany will decrease from current 100 people to about 30. The layoff affects especially the production, as well as sales and administration. The new Pandatel R&D team will focus its efforts on developing next generation of Ethernet and optical products while some development activities as well as manufacturing will be outsourced to Dowslake Microsystems. Pandatel and Dowslake are currently working on a merger plan as they have announced on November 21, 2005.

Other details of restructuring plan include product consolidation and new management team. Currently, Pandatel has more than thousands of product or variants to be produced, with a large number of them selling at extremely low volume. After restructuring, Pandatel will consolidate to 3 product categories - Optical Networking, Ethernet & Multi-service Over SDH/SONET, and Last Mile/TDM Access. Products will be migrated to circuit platforms to decrease manufacturing burden and to improve cost as well as delivery. Total number of product platforms will be decreased to less than 40.

Pandatel also announces its new management team. Andreas Hennig, who is currently head of R&D of Pandatel's Hanover team, will be appointed Vice President of R&D to lead Pandatel's overall R&D effort. Mr. Hennig joined Pandatel in 2003 from Alcatel and has since led the team to develop a number of innovative Ethernet and IP products. Mr. Hennig will be responsible for new product development and performance/feature optimization of the existing products, based on customer feedback. Munther Jadallah, who is currently Managing Director Pandatel Asia Pacific, will be Vice President of Sales & Marketing. Mr. Jadallah has joined Pandatel in 1993 and is instrumental in initiating and developing Pandatel's sales and customer base in the Asia Pacific region. Mr. Jadallah will be responsible for sales and for product marketing, leading a team of regional sales as well as product managers looking after Pandatel's re-organized product lines. Dr. Marc Ruelaender, currently Manager of Quality Management and Technical Service at Pandatel's Lightmaze division, will be appointed Director Quality Management and Business Processes. Dr. Ruelaender joined Pandatel's Lightmaze division in 2002. He has played a major role at Lightmaze in building a practical and effective business process governing Lightmaze's daily activities, resulting in successful development and manufacturing of YUMIX optical products with minimum headcount and resources. Dr. Ruelaender will be responsible to establish or re-adjust Pandatel's current business processes in order to maximize efficiency and to deliver consistent product quality.

"Since I took over the position on November 21, after spending weeks visiting Pandatel's key customers and working with internal people, I come to realize how lucky I was to be engaged with Pandatel," CEO Dr. Dan Yang comments. "Particularly loyal customers, and a great team of engineering talent are the two most valuable things that I discover. With a long history of technology excellence, product innovation, and a great deal of focus on customer satisfaction, I'm convinced Pandatel will succeed in the execution of our restructuring plan, and will emerge as one of the most customer driven and competitive companies in the telecom and data communications industry."

About Pandatel

Pandatel is a German corporation based in Hamburg. Pandatel was formed in
1988 as Pan Dacom Telekommunikation GmbH. It went to public at Frankfurt Prime standard in November 1999. Pandatel provides Ethernet and data connectivity, multiplexing, and protocol conversion products such as Ethernet copper or fiber optic converters and multiplexers, Ethernet-over- SDH/Sonet, SDH/Sonet-over-Ethernet, and optical multi-wavelength transport products for enterprise customers. Pandatel currently sells its products through its regional offices and subsidiaries in France, UK, and Singapore.