PACT Provides Market Update

BEIJING, April 10 /Xinhua-PRNewswire-FirstCall/ -- PacificNet, Inc.
(Nasdaq: PACT), a leading provider of gaming technology, Customer Relationship
Management (CRM) and e-commerce in China, announced the following market
updates today:
1. PACT expects to report Q4 and Fiscal Year 2007 earnings on April 29,
2008, and will hold a conference call to discuss the results and business
outlook for 2008. The Company will announce details on these events as the
company completes its annual audit. The company filed a Notification of Late
Filing on Form 12b-25 with the SEC regarding its upcoming annual report on
Form 10-K due to the significant increase in its scale of operations and a
greater number of accounts to consolidate as a result of recent acquisitions,
resulting in possible late filing, concurrent with its earning call mentioned
above.
2. PACT announced the appointment of Phillip Wong as Chief Financial
Officer effective immediately. Mr. Phillip Wong, age 57, has over 20 years of
hands-on China business experience, including financial and lottery gaming
experience. Mr. Wong has served as president of Shenzhen G-Lot Technology
Limited, a leading provider of lottery technology and systems in China serving
the Welfare and Sports Lottery markets. Mr. Wong was formerly the General
Manager of a listed company in Hong Kong (Jademan - Culturecom: HK Stock Code
0343.HK). Mr. Wong has a Post Graduate Diploma in General Management from
Macquarie University of Australia. He is also a Fellow of the Chartered
Institute of Management Accountants of the UK since 1986 as well as a Fellow
of the Hong Kong Institute of Certified Public Accountants. Mr. Wong was
awarded the Ten Outstanding Young Persons' Award in Hong Kong and was elected
Vice-Chairman of the Ten Outstanding Young Persons Association in the late
1980's. Before the transfer of sovereignty of Hong Kong back to China in 1997,
Mr. Wong was the Convener of the Economic Sub-group of the Basic Law Drafting
Committee of the Hong Kong Management Association. From 1992 to 2002, Mr. Wong
was a Committee Member of the Chinese Political Party's Consultative Committee
of Zengcheng City, Guangdong.
Mr. Daniel Lui, CFO of PACT since February 2007, has announced his new
position as the CFO of JA Solar Holdings Co. (Nasdaq: JASO) effective May 10,
2008. Mr. Lui has agreed to continue to serve PACT as a consultant to assist
with the annual audit, financial and internal control issues and to ensure
smooth transition. We congratulate Mr. Lui and wish him the best in his new
position at JA Solar.
3. PACT reports new gaming machine sales and deliveries to leading gaming
operators in Macau, China, and to Philippines. Further details of the sales
were not disclosed for competitive reasons.
4. As of today, PACT has not received the agreed upon shares of Octavian
International Limited due to certain regulatory delays in Cypress government
which is the jurisdiction that administers the share registration and transfer
of Emperor Limited, the legal owner of Octavian. Accordingly, the acquisition
of Octavian International Limited (as previously described in a Form 8-K
filing dated Jan 28, 2008) has not been completed.
5. PACT expects to report a loss for FY2007 due to certain write-offs and
provision for bad debt related to its legacy telecom operation. Due to the
traditional slow season in the first quarter of the year, PACT expects to
incur a one-time non-recurring loss in Q1 2008, after taking into account of
certain one-time non-recurring write-offs, and merger and acquisition related
expenses.
6. The board of directors and management team have approved PacificNet's
new strategy to focus on the rapidly growing gaming market in greater China,
Macau, and Asia. With the help of professional financial advisors and bankers,
PacificNet will be seeking strategic alternatives for our low-margin telecom
business units which may include sales, disposition, spin-offs and mergers.
PACT's goal is to streamline our operation, downsize the non-performing legacy
operations, and simplify our business strategy with an emphasis on our new
focus on gaming technology development. In recent board and management
meetings, we evaluated the early success of our gaming technology operation
and were satisfied with the rapid progress and financial performance of the
gaming operation, and we agreed to speed up the process to sell off legacy
telecom assets in order to improve the cash position of the Company. PACT
reiterated that the Company intends to refinance the $8 million Convertible
Subordinated Debentures consummated on March 13, 2006, and is actively
evaluating specific refinancing alternatives.
7. As described in a recent press release, three holders of PACT's
Convertible Subordinated Debentures filed an involuntary petition for Chapter
11 relief in federal bankruptcy court late Saturday, March 22nd in Wilmington,
DE. The Company has retained counsel to oppose the filing because the petition
fails to meet the standard for invoking an involuntary bankruptcy and fails to
take into consideration other agreements between the Company and the
petitioning creditors. The Company intends to vigorously oppose the petition
and move for dismissal of the filing, and if successful will seek damages and
attorney fees. Subsequently, PACT also received default notice from all but
one of the bondholders including Iroquois Master Fund Ltd., Alpha Capital AG,
Whalehaven Capital Fund Limited, DKR Soundshore Oasis Holding Fund Ltd., Basso
Fund Ltd., Basso Multi-Strategy Holding Fund Ltd., and Basso Private
Opportunities Holding Fund Ltd. from the same Convertible Subordinated
Debentures related to the private offering of $8,000,000 principal amount
variable debentures consummated on March 13, 2006, and due March 2009. Please
refer to the original Form 8-K filing on March 13, 2006 in which PACT
consummated a private offering of $8,000,000 principal amount variable
debentures due March 2009 (the "Debentures") at an initial fixed conversion
price of $10.00, and warrants to purchase up to 400,000 shares of the
Registrant's common stock exercisable for a period of 5 years at an exercise
price of $12.20 per share (the "Warrants") with several institutional
investors listed above.
PACT has retained counsel to oppose the above petition. The amounts on the
debts in quest are as follows: Iroquois Master Fund Ltd. $2.5 million,
Whalehaven Capital Fund Limited $958,000, Alpha Capital AG $685,000 DKR
Soundshore Oasis Holding Fund Ltd $960,000, and Basso Fund Ltd., Basso Multi-
Strategy Holding Fund Ltd., and Basso Private Opportunities Holding Fund Ltd.,
a combined amount of $500,000.
About PACT
PacificNet (PACT) is a leading provider of gaming and mobile game
technology worldwide with a focus on emerging markets in Asia, Latin America
and Europe. PacificNet's gaming products are localized to their specific
markets creating an enhanced user experience for players and larger profits
for operators. PacificNet's gaming products include multi-player electronic
table games such as baccarat, sicbo and fish-prawn-crab, roulette machines,
Server-Based Games (SBG) with multiple client betting stations, slot and bingo
machines, Video Lottery Terminals (VLTs), Amusement With Prizes (AWP)
machines,
gaming cabinet and client/server system designs, online i-gaming software
design, and multimedia entertainment kiosks as well as the Octavian line of
casino management software, hardware and games. PacificNet's gaming clients
include the leading hotels, casinos, and gaming operators in Macau, Europe and
elsewhere around the world. PacificNet also maintains legacy subsidiaries in
the call center and ecommerce business in China. PacificNet employs about
1,500 staff in its various subsidiaries with offices in the US, Hong Kong,
Macau, China. For more information please visit http://www.PacificNet.com .
For more information, please contact:

PacificNet USA office:
Jacob Lakhany
Tel: +1-605-229-6678
Email: investor@pacificnet.com

SOURCE PacificNet, Inc.

Jacob Lakhany at the PacificNet USA office, +1-605-229-6678,
investor@pacificnet.com