Aqueduct and ChannelWave Join Forces to Deliver Industry's Most Complete Channel Management and Commerce Solution.

Business Editors/High-Tech Writers

ALISO VIEJO, Calif. & CAMBRIDGE, Mass.--(BUSINESS WIRE)--Dec. 8, 2003

Aqueduct, Inc. and ChannelWave Software, Inc. today announced that the two companies have merged and formed a new company called ChannelWave, Inc.

The merger combines ChannelWave's leadership in Partner Relationship Management solutions (recruiting, training, planning, marketing, sales) and CRM, with Aqueduct's strength in managed B2C and B2B commerce services, which enable manufacturers to sell and support products directly online or through dealer, VAR and retail channels. The unified company provides the industry's strongest multi-channel sales and marketing solution with integrated commerce, enabling businesses to increase sales and margins by building stronger connections with their channels and customers.

"By combining the strengths of Aqueduct and ChannelWave, we are creating exceptional value for our customers and helping them solve their most important business problems throughout the demand chain," said Rob Hagen, Chairman and CEO of ChannelWave, Inc. "This merger is a compelling fit strategically, joining two companies with a shared culture of execution and commitment to customer success, and providing a strong financial foundation that will generate positive cash flow immediately and support fast growth in new and existing markets."

"Today is an important milestone for ChannelWave and establishes our industry leadership in addressing the unmet market demand for integrated channel management and commerce," said Chris Heidelberger, President of ChannelWave, Inc. "We now provide a powerful, unique combination of sales, marketing and commerce solutions that deliver faster time-to-value than competing solutions by enabling businesses to sell more products and services through all channels to market."

ChannelWave's solutions and managed services enable customers to improve business performance during every step of the demand management process, from developing channels to creating demand, managing and closing sales opportunities, managing contracts and pricing, transacting and fulfilling orders and managing customer service, warranties and returns. The company is helping more than 100 leading high-tech, telecommunications, manufacturing and automotive customers, including AT&T, BEA Systems, HP, Kia Motors, Logitech, PTC, Research in Motion (RIM), Sharp Electronics, Sony, Toshiba and Verizon, to improve channel sales and profitability.

"The merger of ChannelWave and Aqueduct demonstrates how two companies are combining their strengths to capitalize on 'lead-to-quote-to-order-to-fulfillment' process so critical for many companies in a diverse set of vertical markets," said Louis Columbus, Senior Analyst at AMR Research. "ChannelWave's strength in capturing, managing and escalating leads, automating funds management and applying metrics to channel performance, coupled with Aqueduct's success in helping companies manage pricing, orders and fulfillment more efficiently across B2B and B2C commerce channels, provides a compelling value proposition for their existing customers and the broader market. Further, this also shows the pervasive need companies have for lead-to-quote, quote-to-order and order-to-fulfillment processes being automated efficiently to support growth."

ChannelWave's competitive differentiation includes:

-- Multi-channel platform: Deepest functionality available to

help companies sell more through channels - with complete PRM,

order management and multi-channel commerce.

-- Vertical Integration: Relationships with leading distributors

such as Ingram Micro and Tech Data, with commerce applications

linked directly to distributor catalogs and a range of

value-added services, including fulfillment, streamline the

process of bringing products to market.

-- Managed Services: IT support (hosting, Web design, software

development) and value-added services in business processes

(telesales, fulfillment, claims processing) and go-to-market

strategies (channel alignment, recruitment, merchandising)

help customers focus on core businesses, increase margins

and achieve rapid and repeatable success.

-- Domain expertise: Strong customer base and deep experience in

high-tech, manufacturing and telecommunications establish

ChannelWave at the intersection of multiple relationships and

transactions among vendors, distributors and channel partners

- making it easier for businesses to reach their customers.

-- Flexible business model: Managed services and Web-based tools

that support rapid, low-cost hosted and on-site deployments

and both .NET and Java technologies.

The merger agreement between Aqueduct, founded in 1999 as a spin-off of Buy.com., and ChannelWave, founded in 1998, was completed on Dec. 1. The two companies had previously explored partnering opportunities and decided that merging would best meet Aqueduct clients' needs for PRM functionality and ChannelWave customer requests for integrated commerce functionality as part of a channel management solution. ChannelWave will maintain offices in Aliso Viejo, CA and Cambridge, MA, as well sales offices across the United States. Lead investors include Mobius Venture Capital, formerly SOFTBANK Venture Capital, U.S. Venture Partners, ABS Capital Partners and Lazard Technology Partners.

About ChannelWave

ChannelWave, Inc. helps businesses increase sales and margins by building stronger connections with their channels and customers. The company's channel management and commerce solutions improve business performance during every step of the demand management process from developing channels to creating demand, managing and closing sales opportunities, managing contracts and pricing, transacting and fulfilling orders and managing customer service, warranties and returns. The company also manages commerce sites that enable businesses to sell and support products directly online or through dealer, VAR and retail channels. ChannelWave delivers its solutions through both a managed service model and as licensed software, allowing customers to achieve faster and stronger results than with competing solutions. ChannelWave has more than 100 high-tech, manufacturing, telecommunications and automotive customers, including AT&T, BEA Systems, HP, Kia Motors, Logitech, PTC, Research in Motion (RIM), Sharp Electronics, Sony, Toshiba and Verizon. The company is headquartered in Aliso Viejo, CA and has sales offices across the United States. More information is available at www.channelwave.com or by calling [phone].

ChannelWave is a registered trademark of ChannelWave, Inc. All other logos, company and product names may be trademarks or registered trademarks of their respective owners.