This excerpt taken from the XETA 10-Q filed Jun 2, 2009.
PART II. OTHER INFORMATION
During the fiscal quarter covered by this report, the arbitration claim filed in April 2008 by Design Business Communications, Inc., d/b/a/ American Telephone (AMTEL) against us and Hitachi Telecom (USA) Inc. (HITEL) alleging a breach of AMTELs Authorized Distributorship Agreement with HITEL (Distributor Agreement), was largely resolved pursuant to the terms of the settlement agreement entered into by all three parties in November 2008. (A full description of the alleged breach, which was based upon an order by AMTEL for 48 discontinued phones, is set forth under Item 3. Legal Proceedings in the Companys Form 10-K filed January 23, 2009). During the quarter, XETA delivered an agreed upon number of new phone sets to AMTEL and AMTEL paid XETA the agreed price for the phones, all in accordance with the terms of the settlement agreement. The settlement agreement also requires AMTEL to file a dismissal of the arbitration, which remains to be filed as of the date of this 10-Q report.
Additionally, we are involved as a plaintiff in another matter which we consider to be routine and incidental to the operation of our business. We do not believe this proceeding will have a material affect on our financial position or results of operations.
The information presented below is an update to the Risk Factors included in the Companys Annual Report on Form 10-K for the fiscal year ended October 31, 2008 and should be read in conjunction therewith. Except as set forth below, the Risk Factors included in the Companys Form 10-K for its 2008 fiscal year have not materially changed.