SAN DIEGO -- Path 1 Network Technologies Inc. (AMEX:PNO) , a leading provider of IP video gateway products that enable the transmission of broadcast-quality video over IP networks, announced today that the Company has secured up to $1.0 million in additional loans from Laurus Master Fund, Ltd. (Laurus), a fund organized in the Cayman Islands that specializes in providing funding to small cap companies. Path 1 drew down $916,000 upon the inception of this credit facility. Laurus also agreed to modify payment terms on its previous term loan agreement executed in with Path 1 in December 2005 which amounts to a payment deferral of $303,000.

"Path 1 continues to execute its market repositioning strategy and capitalization plans," said Tom Tullie, President and CEO of Path 1. "As previously announced, we plan to secure additional financing that will enable the firm to realize its full growth potential. This growth will be driven from the leverage of Path 1's unique technology and insights on cost effectively delivering high quality television content over the public internet."

The financing consists of a revolving non-convertible secured credit facility of up to $1.0 million, has a 2 year term and bears an interest rate equal to prime plus 2.00% per annum, payable monthly in cash. In connection with the financing, Laurus was also issued a seven year Warrant to purchase up to 662,252 shares of Path 1 common stock at an exercise price of $1.51 per share. Additionally, Laurus has agreed to postpone five months of principal payments totaling $303,000 related to the $2.1 million convertible term note issued in December 2005. Monthly principal payments will resume in September 2006.

Path 1 will file a registration statement with the Securities and Exchange Commission for the Company's common stock underlying the Warrants.

Path 1 Network Technologies Inc. (Amex: PNO)