Spire Capital Partners Acquires Majority Interest in Carpathia Hosting

Experienced Management Team & Growth Capital Put in Place

ASHBURN, Va., July 8 -- Carpathia Hosting, Inc., a leading provider of managed hosting services for enterprises and government agencies that require 100% availability, announced today that Spire Capital Partners has acquired a majority interest in Carpathia. Under the agreement, the original investors participated in the deal with the former CEO staying on board. In conjunction with this investment, a new CEO and CFO with considerable industry experience will be joining the management team. Spire has committed significant growth capital to expand Carpathia's existing operations.

Peter Weber will lead the new Carpathia management team as CEO. Weber founded, led and sold SevenSpace, a Washington D.C.-based IT services company, to Sun Microsystems in 2005 after which he was retained by Sun to lead Sun's Services Group, a $5 billion product division. Bill Ranney will join the new Carpathia management team as CFO. Ranney served as CFO at SevenSpace and has served in senior finance roles at Sun Microsystems and Verizon. Rick Smith, former CEO, will remain at Carpathia as a member of the executive leadership team.

"I am thrilled to be leading Carpathia into this significant growth phase of the company," said Peter Weber, CEO of Carpathia. "Our deep managed services portfolio, combined with our dedication to delivering our customers and partners world-class service, will fuel our growth in the coming quarters and years."

Carpathia provides hosting solutions including managed dedicated servers, security and backup services, remote monitoring and management services and collocation services. To provide the best possible service, Carpathia partners with data center builders and facility owners to deliver its clients the best option for their specific hosting needs. Carpathia holds a number of key certifications including DoD Information Technology Security Certification and Accreditation Process (DITSCAP) and SAS70 certification.

"We believe Carpathia is well-positioned to capitalize on the favorable outsourcing trends in the IT services/hosting marketplace through the company's success in delivering top-notch services to significant government agencies and corporate clients," said Sean White of Spire. "We are excited to partner with the management team and provide the financial resources required to deliver quality services to Carpathia's enterprise and government clients."

Carpathia differentiates itself because of its speed and flexibility in delivering complex hosting solutions for both federal and commercial clients. Carpathia delivers customers and partners an experience that exceeds expectations -- from evaluating and identifying hosting sites through managing complex, dedicated, virtualized environments.

"Carpathia has been a valued partner in providing virtualization and management services for our complex infrastructure. By improving availability and reducing infrastructure costs, Carpathia has had a significant impact on the success of our pharmacy and supply chain management solutions," said Mihir Desai, CIO of ChainDrugStore.net. "We look forward to working with the new management team at Carpathia as our needs for managed hosting services continue to expand."

With a new investment partner and expanded management team, Carpathia is well positioned to grow its already strong commercial and federal client base. The additional capital provided by Spire will enable Carpathia to further invest in delivering the highest quality managed hosting services in the industry.

About Carpathia Hosting, Inc.

Carpathia Hosting is a leading provider of enterprise application hosting for government agencies and businesses that require 100% application availability. Employing dynamic technologies that remove hardware dependencies and improve efficiencies, Carpathia Hosting solutions strive to reduce operational costs while surpassing SLA requirements. As a datacenter neutral company, Carpathia Hosting is quickly becoming the hosting company of choice for companies that demand security, quality and high performance. For more information, visit www.carpathiahost.com.

About Spire Capital Partners L.P.

Founded in 2000, Spire Capital is an active and experienced private equity firm with an investment focus in companies within the business services, information services, media and communications sectors. Spire Capital leads buyout investments in its areas of expertise and believes its deep industry experience and network of relationships are invaluable in helping its portfolio companies to grow and succeed. Spire Capital currently has approximately $600 million in assets under management across two funds. For more information, visit www.spirecapital.com.