LONDON – February 10, 2004. ESPOTTING MEDIA INC. announced today the signing of an amended agreement to merge with Nasdaq listed (Nasdaq FWHT), a leading developer and provider of performance-based marketing services for the Internet. The merger is intended to create an international leader in performance-based Internet marketing with combined operations and partnerships across the globe.

Under the proposed terms of the transaction, which was approved by the board of directors of each company, Espotting stockholders will receive 7.0 million shares of common stock and approximately $20.0 million in cash. The amount of cash Espotting stockholders will receive may vary based upon Espotting’s net assets on the closing date. will also issue options and warrants to purchase an estimated 800,000 shares of common stock to Espotting employees and affiliates. At’s closing share price on February 6, 2004, the transaction values Espotting at approximately $170 million (£92 million / Euro 134 million). As a result of the merger, the combined company would have approximately 33.5 million shares outstanding on a fully diluted basis, with’s stockholders, employees, and affiliates beneficially owning approximately 25.7 million shares, and Espotting’s stockholders, employees, and affiliates beneficially owning approximately 7.8 million shares.

Daniel Ishag, founder and CEO of Espotting, said: “We now have been in discussions with on a merger of our two companies for over a year, and we have never wavered from our belief that we can create significantly greater value for all of our constituencies as one, combined organization. We continue to feel that with this single transaction both companies achieve a step change in scale which should allow us to capitalize fully on the rapid expansion in performance-based online marketing. We continue to view the combination as a ‘merger of the bests,’ allowing the two companies to bring together the best of their respective talents. A critical component of both companies’ strategy is to understand the specific, cultural needs of each market we serve, and we are extremely excited about the opportunity to create one company that has such local expertise on three continents.”

Espotting was formed in February 2000, and launched its service in the UK in September of that year. Over the last two years, Espotting has launched its service in nine additional markets across Europe. was formed in March 1998 and became a publicly-traded company in June 1999.

The merger agreement provides that upon closing of the merger, two nominees from Espotting will join’s board of directors. has secured voting agreements from Espotting’s principal stockholders and certain directors and officers. The merger agreement includes post-closing indemnification provisions by Espotting, and an escrow of a portion of the transaction value.

Transaction Notes

Closing of the transaction is conditioned upon regulatory filings and approvals, shareholder votes by both companies, the absence of a material adverse change in the companies’ businesses, the meeting of certain requirements before and until the closing date, and other closing conditions. As a result, the merger may be consummated on significantly different terms or not at all. Assuming the fulfillment of these conditions and the receipt of all approvals, the companies would expect to close the merger in the third quarter of 2004.

The proposed merger provides that Espotting will be merged with and into a wholly-owned subsidiary of with Espotting surviving the merger.


UK Press Release – for UK residents

This translation of a press release issued in the UK is made available to you for information only. It does not constitute an offer or inducement to shareholders of Espotting Media Inc or or to any other person to enter into any investment activity in connection with the proposed transaction. Persons who access this translated press release are advised that it has not been approved by an authorised person in the UK, or by any equivalent person in any European or other jurisdiction and that it should not form the basis for any investment decision. You are required to inform yourselves of any local legal and regulatory requirements before taking any steps on the basis of this translated press release. Anyone viewing this translated press release who is affected by the transaction (for example a shareholder in Espotting Media Inc) should contact an appropriately qualified independent financial adviser if they have any questions regarding the proposed transaction.

About Espotting

Espotting Media is Europe’s “Best Paid Placement Service” (Search Engine Watch Awards). Espotting operates an online marketplace where advertisers bid against each other for prominence within search listings that Espotting delivers. The higher an advertiser bids, the higher that advertiser is listed. An advertiser only pays for the traffic it receives – it’s pay-per-click advertising that is 100% cost-effective and accountable. Espotting currently has over 20,000 advertisers, including British Airways, Norwich Union Direct, eBay, and Espotting is a network, not a destination site or a portal. Through its search network Espotting powers over 1 billion queries each month across Europe. Espotting currently services 10 European territories - the UK, France, Germany, Spain, Italy, Ireland, Switzerland, Sweden, Denmark, and Norway. More information on Espotting is available on Espotting’s website at

Contact Details

Espotting Contact:
Chrys Philalithes
Espotting Marketing Director
T: 020 7539 0500

Published on: 12:00AM on 10th February 2004