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Vertical Begins Strategic Reorganization

New management structure enables company to deliver strategic applications and services to its channel partners, driving share and revenue growth.

SANTA CLARA, California, May 17, 2011 – Vertical Communications, a leading provider of next-generation IP-based phone systems and voice applications, today announced a number of important organizational changes and expansion of some key executive responsibilities. The changes align the business around the core strengths of Vertical to continue to develop and enhance its distribution and dealer channels and the servicing of those channels through its sales, marketing and operational organizations.

“In order to get to our next level of growth, the Board and Executive team have started to take strategic actions to capitalize on the tremendous opportunities in the IP-based telephony market,” said William Tauscher, Executive Chairman.

New Chief Executive Officer (CEO)

The Vertical Board of Directors has appointed current President and Chief Operating Officer, Peter Bailey to Chief Executive Officer. Mr. Tauscher will step down as Chief Executive Officer but will remain Executive Chairman.

“Peter has proven his ability to lead our Company with the right mix of leadership skills, industry experience, competitive drive and results orientation. Over the last 18 months he has been responsible for the vast majority of the day-to-day operations of the business and we are confident will excel as our new Chief Executive Officer,” said William Tauscher, Executive Chairman.

“Our strategy is clear – to become the leading IP telephony and Unified Communications vendor servicing the 0-500 business market, partnered with a world-class VAR channel. Our focus will be on vertical industry markets including retail, healthcare and education,” said Peter Bailey, newly appointed Chief Executive Officer.

New Chief Operating Officer (COO)

In another management move, Rick Dell, former Mitel Networks President, joins Vertical as Chief Operating Officer. Rick has been a leader in the telecommunications industry for more than 20 years, working in many capacities. Most recently Rick served as president of Mitel Networks, leading sales, marketing and operations. Prior roles include fifteen years with former industry leader Inter-Tel, Inc, as a Senior Vice President of Sales, where he was responsible in 2007 for the successful merger of all US Sales and Operations for Mitel and Inter-Tel. Prior to joining Inter-Tel, Rick served in various sales roles with TIE Communications, Inc. and Executone of Ohio.

“We are thrilled to have Rick Dell join the management team at this important juncture in Vertical's development. Rick is an industry veteran with vast experience and a proven track record in building world-class sales and operations organizations. Over the last several years both at Inter-Tel and Mitel he led large sales, marketing and operations organizations that commanded significant market share in the North American and Western European enterprise telephony markets”, said Bailey. Adding, “As Vertical concentrates on substantial market share gains, and seeks to attract additional world-class distribution partners. Rick is the right leader to add to our organization and I believe will play a pivotal role in giving our partners the confidence they need to succeed.”

 

About Vertical Communications, Inc.

Vertical Communications is one of the largest telephony vendors in North America and a global leader in next-generation IP-based business communications systems and applications, with a current installed base of over 200,000 customers. Vertical combines voice and data technologies with business process understanding to deliver integrated IP-PBX and application solutions that enhance customer service and business productivity. Vertical's customers are leading companies of all sizes, from small to large and distributed, and include CVS/pharmacy®, Staples and Apria Healthcare. Vertical delivers its solutions through a worldwide network of over 1800 business partners. With headquarters in Santa Clara CA, Vertical has facilities in Charlottesville VA, Phoenix AZ, Santa Clara CA, Munich Germany and Hyderabad India. For more information about Vertical, please call 1-877-VERTICAL or visit our Website at www.vertical.com.

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"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995.
This document contains forward-looking statements based on current expectations or beliefs, as well as a number of assumptions about future events, and these statements are subject to important facts and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The forward-looking statements in this document address a variety of subjects, including, without limitation, statements about the benefits of certain of the Company's products, including, without limitation, the improved cost and customer service benefits for the Company's business partners and customers; the Company's assumptions about its future performance; the Company's ability to enhance its revenue opportunities in the IP-PBX marketplace; the Company's ability to continue providing products to the IP-PBX marketplace, the Company's ability to continue to certify additional Internet Telephony Service Providers in the IP-PBX marketplace and others. The following factors, among others, could cause actual results to differ materially from those described in these forward-looking statements: the risk that the Company may fail to achieve its anticipated growth, including, without limitation, failing to obtain the desired benefits for the Company's dealers and customers; the risk that the Company's assumptions about its future performance may prove to be incorrect; the risk that the Company may be unable to become a significant player within the IP-PBX telephony market; the risk that the Company will not be able to certify its products with additional Internet Telephony Service Providers.

Trademark Information
Vertical Communications and the Vertical Communications logo and combinations thereof, are registered trademarks of Vertical Communications, Inc. All other brand and product names are used for identification only and are the property of their respective holders.

PRESS CONTACT:

Craig Morgan
Vertical Communications, Inc.
cmorgan@vertical.com
+1 (408) 404-1643