Following the announcement of a proposed buyout of XETA Technologies an investigation for investors in XETA Technologies, Inc. (NASDAQ:XETA) shares questioning the potential unfairness of the deal and possible breaches of fiduciary duties by certain XETA Technologies officers and directors was announced.

The investigation by a law firm concerns possible breaches of fiduciary duties by certain officers and directors at XETA Technologies arising out of their attempt to sell XETA Technologies, Inc to PAETEC Holding Corp.

On Monday, Feb 9, 2011, before the market opened PAETEC Holding Corp. (NASDAQ GS: PAET) announced that it has signed an agreement to acquire XETA Technologies, Inc. (NASDAQ GM: XETA) for $5.50 per share in cash valued at approximately $61 million.
Shares of XETA Technologies, Inc. (Public, NASDAQ:XETA) traded on Tuesday, Feb 8th, at $3.87 per share and increased to $5.42 in response to the takeover proposal.

But the investigation concerns whether XETA Technologies Board of Directors undertook an adequate and fair sales process to obtain fair consideration for all shareholders of XETA Technologies, Inc. (NASDAQ XETA) and specifically breached their fiduciary duties to XETA Technologies (XETA) shareholder by failing to adequately shop the Company before entering into this transaction.
XETA Technologies performance for its shareholders increased over the past years. XETA Technologies 12 months Total Revenue went from $70.09million reported on Oct 31, 2007 to $85.68million reported on Oct. 31, 2010. Specifically, on December 30, 2010, XETA Technologies reported fourth quarter 2010 revenues of $24.5 million, a 36% increase over fourth quarter 2009 results.

A potential class action lawsuit would seek to maximize the amount of money and information XETA shareholders would receive in a buyout, so the law firm.