KeyOn Launches Aggressive Acquisition Initiative for Wireless Broadband Companies

OMAHA, Neb.--(BUSINESS WIRE)--KeyOn Communications Holdings, Inc. (OTCBB: KEYO [1] - News [2]), one of the largest providers of wireless broadband, satellite video and voice over Internet protocol (VoIP) services in the United States, announced today that the company has launched an aggressive acquisition initiative, called Rural UniFi, designed to rapidly expand its subscriber base and network footprint. KeyOn already boasts a network covering 50,000 square miles in 11 states, making it ideally positioned to integrate wireless broadband companies in contiguous areas. The Company has successfully integrated four previous acquisitions resulting in growth of its subscriber base and revenues while expanding EBITDA margins.

Commenting on the initiative, Jonathan Snyder, President and CEO, stated, “We have been focused on growing broadband subscribers in rural markets for over seven years, having evolved from a single market operator to a company that is one of the largest providers of wireless broadband in the country. The rural wireless broadband industry is extremely fragmented, with very few companies realizing any economies of scale in their businesses. Considering the current lack of capital available in the market, the Rural UniFi initiative represents a way for wireless broadband companies to unlock the value of their networks. Our companies can share in the upside of a larger, scalable company while we leverage our existing systems, management experience and wide distribution network. Over the coming months, we expect to make several announcements about companies that have agreed to join the initiative.”

Because of the lack of available broadband options, rural markets are often served by independent wireless broadband operators who provide valuable broadband services to their communities. Despite their efforts, rural markets continue to lag their urban and suburban counterparts in terms of home broadband penetration by over 20 percent (approximately 45% versus 65% broadband penetration for rural and urban, respectively). While some progress has been made increasing rural broadband penetration, there is still a significant amount of growth opportunity remaining. By bringing greater scale, purchasing power, favorable pricing and top-tier technology partners to these communities, KeyOn believes it can accelerate rural broadband adoption and expedite the delivery of next-generation services.

Mr. Snyder continued, “While we remain excited about the potential opportunities through the American Recovery and Reinvestment Act of 2009 (ARRA), we have always grown through acquisitions and our Rural UniFi initiative reinvigorates this effort in a big way. Given our diverse coverage area across the Midwestern and Western U.S. and our experience in growing rural markets, we are strategically positioned to continue to successfully integrate rural wireless broadband providers into KeyOn’s operations. We have always believed that by bringing together contiguous networks we can create a sizable, next-generation rural telecommunications company.”

KeyOn has added resources in support of the Rural UniFi initiative in order to handle the volume of pending transactions and inquiries. Interested wireless broadband operators can visit KeyOn’s unique initiative through the Company’s website (www.keyon.com/ruralunifi.html [3]) where they can receive more information and begin the qualification process.

About KeyOn Communications Holdings, Inc.

KeyOn Communications Holdings Inc. (OTCBB: KEYO [4] - News [5]) is one of the largest providers of wireless broadband, satellite and voice over Internet protocol (VoIP) services in the United States, primarily targeting underserved markets with populations generally less than 50,000. KeyOn offers broadband services with VoIP and satellite video services to both residential and business subscribers across 11 Western and Midwestern states. Through a combination of organic growth and acquisitions, KeyOn has expanded its network footprint to reach approximately 50,000 square miles and cover nearly 2,500,000 people as well as small-to-medium businesses. Management intends to drive subscriber growth through additional acquisitions as well as organic growth across the company’s expanding footprint by offering bundled services including broadband, video and VoIP and related valuable services such as the Bullseye Club. Through its participation in the American Recovery and Reinvestment Act of 2009 (ARRA) and its allocation of $7.2 billion for the deployment of broadband infrastructure, among other things, the company intends to build next generation wireless broadband networks in and around its market footprint. More information on KeyOn can be found at www.keyon.com [6].

Non-GAAP Measures

This press release includes disclosure regarding “EBITDA” which is a measurement used by KeyOn Communications to monitor business performance and are not recognized measures under GAAP (generally accepted accounting principles). Accordingly, investors are cautioned in using or relying upon these measures as alternatives to recognized GAAP measures.

“EBITDA” is defined as earnings or loss from operations adjusted for depreciation, amortization, interest expenses, goodwill impairment, non-cash stock based compensation expenses. Adjusted EBITDA should not be construed as an alternative to operating loss as defined by GAAP.

Safe Harbor Statement

Certain statements contained in this press release are "forward-looking statements" within the meaning of applicable federal securities laws, including, without limitation, anything relating or referring to future financial results and plans for future business development activities, and are thus prospective. Forward-looking statements may include, without limitation, the company’s expectations regarding: future financial and operating performance and financial condition; plans, objectives and strategies; product development; industry conditions; the strength of its balance sheet; and liquidity and financing needs. Readers are cautioned not to put undue reliance on such forward-looking statements, which are not a guarantee of performance and are subject to a number of uncertainties and other factors, many of which are outside of the company’s control, which could cause actual results to differ materially from such statements. For a more detailed description of the factors that could cause such a difference, please refer to the company’s filings with the Securities and Exchange Commission, including the information under the headings “Risk Factors” and “Forward-Looking Statements” in our Form 10-KSB filed on April 15, 2009. Consequently, future events and actual results could differ materially from those set forth in, contemplated by, or underlying the forward-looking statements contained herein. The company undertakes no obligation to update or supplement such forward-looking statements.