Encompass Group Affiliates, Inc.(fka ECGA)

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Pacific Magtron Signs Interim Management Agreement With Micro Technology Concepts
Transaction Will Provide Means for Pacific Magtron to Operate While Joint Venture is Submitted for Approval by the Court
6/16/2005 2:39:28 PM

NEW YORK, June 16, 2005 /PRNewswire-FirstCall via COMTEX/ -- Advanced Communications Technologies, Inc. (ADVC) and its majority owned subsidiary, Pacific Magtron International Corporation (OTC Bulletin Board: PMIC), announced today that effective June 7, 2005, Pacific Magtron, Inc., an operating subsidiary of Pacific Magtron International Corporation ("PMIC"), has signed a definitive Interim Management Agreement with Micro Technology Concepts, Inc., a wholly owned subsidiary of MTC Direct and a privately held California-based distributor of storage and media products. As a result, Pacific Magtron, who is currently under Chapter 11 bankruptcy protection, will be able to continue operations distributing computers, peripherals and components to customers from its current location in Milpitas, California.

Under the terms of the agreement, which was approved by the bankruptcy court yesterday, Micro Technology Concepts will, for a period of 60 days, or upon earlier approval by the court of a proposed joint venture, manage the operations of Pacific Magtron's business and supply the company with merchandise to ensure ample inventory and uninterrupted service to Pacific Magtron's customers. In return, Micro Technology Concepts will receive a fee in the form of a percentage of the gross margin generated by Pacific Magtron's sales. Micro Technology Concepts is Pacific Magtron's largest vendor and secured creditor, and has been the company's supplier for several years.

The signed agreement provides an opportunity for Micro Technology Concepts to expand its U.S. customer base. Additionally, and subject to approval by the court, both parties have agreed to enter into a binding joint venture, to be named Pacific Connections, LLC. Under the terms of the joint venture, Pacific Magtron will receive 50% of the profits generated by Pacific Connections during its first two years of operations in return for its trademarks, goodwill, customer relationships and access to staff. Pacific Magtron's profits generated by Pacific Connections will be used to satisfy creditors of Pacific Magtron. In addition, Pacific Connections will assist in selling Pacific Magtron's remaining inventory and collecting its accounts receivables without additional fees.

Martin Nielson, chairman and chief executive officer of PMIC, stated, "This new relationship with Micro Technology is an important first step in the re-launch of the company and provides the basis for a solution for Pacific Magtron's creditors." Nielson continued, "When the company filed for voluntary bankruptcy because it could not continue operations, we were determined to find an operating partner to manage our legacy business and protect our creditors. I am confident that Roy Han, president of Micro Technology, and his team of motivated seasoned professionals will prove to be a productive partner in serving our customers while we work together to secure approval for Pacific Magtron's reorganization plan."

"I believe that we are a superior fit for Pacific Magtron's computer, peripheral and software distribution business," said Han, adding, "I have been doing business with this company for over ten years, so we already know that we can work well together, which gives us an immediate advantage in making this effort successful. Restoring Pacific Magtron's customer service and creating future value for our businesses under one company name once the joint venture is consummated will be our collective goal." Han closed, "We are committed to supporting Pacific Magtron's reorganization and look forward to working more closely with their team."

Wayne Danson, president and chief executive officer of Advanced Communications, said, "We have been working very closely with PMIC's management and with Roy Han to bring this planned joint venture to a proper conclusion. This represents the first in a series of new strategies that we intend to execute in support of our overall plan and investment in PMIC."

About Advanced Communications Technologies, Inc.

Advanced Communications Technologies, Inc. is a publicly traded New York City-based technology and services holding company that, through its majority owned subsidiary, Pacific Magtron International Corporation, is a distributor of hardware components, computer systems and software products and, through its wholly owned subsidiary and principal operating unit Encompass Group Affiliates, Inc., is a provider of board-level repair of technical products to third-party warranty companies, OEMs, national retailers and national office equipment dealers. Service options include advance exchange, depot repair, call center support, parts and warranty management for office equipment, fax machines, printers, scanners, laptop computers, monitors and multi-function units, including high-end consumer electronics such as PDAs and digital cameras. Additionally, through its wholly owned investment subsidiary Hudson Street Investments, Inc., Advanced Communications makes strategic minority investments in public and private companies. For more information, visit Advanced Communications' website at http://www.advancedcomtech.net .

A profile for investors on Advanced Communications may be found at the website http://www.hawkassociates.com/advancedcommunications/profile.htm .

An online investor relations kit containing Advanced Communications' press releases, SEC filings, current Level II price quotes, interactive Java stock charts and other useful information for investors can be found at http://www.hawkassociates.com and http://www.hawkmicrocaps.com .

About Pacific Magtron International Corporation

Pacific Magtron International Corporation, based in Milpitas, California, and currently operating under Chapter 11 bankruptcy protection, was a distributor, e-commerce reseller and system/solution provider of a wide range of systems, hardware components and software with a historically significant presence in online sales. Its customer base included a wide spectrum of technology-based suppliers to the consumer, corporate, education and government markets. Pacific Magtron, Inc., its wholly owned subsidiary and principal operating business, has offered over 1,800 different computer products from more than 50 vendors including a line of peripherals sold under its trademarked "EZ-Media" brand name. It maintains long-standing relationships with many of the industry's most recognizable and innovative computer peripheral manufacturers, including Microsoft, Sony, Plextor, Creative Labs, Adaptec, ATI, Kingston and Logitech, among others. For more information, visit Pacific Magtron's website at http://www.pacificmagtron.com .

About Micro Technology Concepts, Inc.

Micro Technology Concepts, Inc. is a wholly owned subsidiary of MTC Direct and a Southern California-based provider of mass storage solutions. It is an independent hard disk drive and mass storage product distributor, with over 2,500 storage resellers worldwide and approximately $400 million in revenue. Micro Technology Concepts has offices throughout the United States, Europe and Asia and has been ranked by VAR Magazine as one of the top storage VARs since 1999. While focusing on its core business as a mass storage specialist in the industry, Micro Technology Concepts has been actively pursuing emerging storage-related growth opportunities through mergers, acquisitions and by partnering with its technology alliances, financial institutions, channel partners and key customers. It is noted as one of the largest suppliers of AMD dual Opteron-based motherboards and systems, and Roy Han, CEO, has been noted as one of the industry's leading authorities on integrated storage topologies. Company information may be found at http://www.mtcusa.com