Zhone further expands its geographic reach and customer base by completing its acquisition of Paradyne

Notes and media contacts

About Zhone Technologies, Inc.:
Zhone designs and manufactures network equipment for network operators worldwide. Zhone's products allow network operators to deliver a rich array of voice, data, video, and entertainment services over their existing networks while simultaneously retooling for converged packet-based voice (VoIP) and video (IPTV) over copper or fiber access lines. Zhone's advanced networking solutions include the Single Line Multi-Service architecture (SLMS(TM)), Multi-Access Line Concentrator (MALC(TM)), Raptor(TM) and GrandSLAM ATM/IP DSLAMs, Ethernet in the First Mile bonded solutions, Zhone Residential Gateways (ZRG(TM)), GigaMux(TM) Optical Transport Systems and Zhone Management System (ZMS(TM)). With deployments at over 400 carriers including among some of the world's largest networks, Zhone has enabled network operators to reinvent their businesses. For more information, please visit www.zhone.com.

Forward-Looking Statements
This press release contains forward-looking statements that are entitled to the protection of the safe harbors contained in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including forward-looking statements regarding the timing of the integration, the anticipated benefits, operating efficiencies and cost synergies that may be achieved in connection with the acquisition, the degree to which the combined company will alter the competitive landscape in its industry and the combined company's ability to successfully fulfill its customers' needs. Actual results could differ materially from those expressed in or contemplated by the forward-looking statements. Factors that could cause actual results to differ include the possibility that the intended benefits of the acquisition may not be fully realized, the failure of the combined company to retain key employees, the failure of the combined company to manage the cost of integrating the businesses and assets of Zhone and Paradyne, general economic conditions, the pace of spending and timing of economic recovery in the telecommunications industry, the combined company's inability to sufficiently anticipate market needs and develop products and product enhancements that achieve market acceptance, and higher than anticipated expenses the combined company may incur in future quarters. In addition, please refer to the risk factors contained in Zhone's SEC filings, including without limitation, the definitive joint proxy statement/prospectus filed on August 3, 2005, Zhone's Annual Report on Form 10-K for the year ended December 31, 2004 and Zhone's Quarterly Report on Form 10-Q for the quarter ended June 30, 2005, and in Paradyne's SEC filings, including without limitation, Paradyne's Annual Report on Form 10-K for the year ended December 31, 2004 and Paradyne's Quarterly Report on Form 10-Q for the quarter ended June 30, 2005. Readers are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date on which they are made. Zhone undertakes no obligation to update or revise any forward-looking statements.



Zhone, the Zhone logo, and all Zhone product names are trademarks of Zhone Technologies, Inc. Other brand and product names are trademarks of their respective holders. Specifications, products, and/or product names are all subject to change without notice. Copyright ©2005 Zhone Technologies, Inc. All rights reserved.


For more information please contact:

Zhone Technologies, Inc.
Investors
Tel: +1 510-777-7013
Fax: +1 510-777-7001

or

Anne Harding, The Message Machine
Tel: 01895 631448