Peapod and Food.com Announce Strategic Marketing Agreement.

CHICAGO and SAN FRANCISCO--(BUSINESS WIRE)--Sept. 30, 1999--

Will Cross-Promote Services and Benefits

Peapod, Inc. (Nasdaq: PPOD), the nation's leading Internet grocer, and Food.com, the Internet's premier restaurant meal take-out and delivery service, today announced that they have entered into a strategic co-marketing agreement.

Under terms of the agreement, Peapod and Food.com will use a variety of channels to communicate the benefits of their services to each other's extensive customer bases. Exclusive offers will also be promoted to Peapod's approximately 100,000 customers and Food.com's more than 650,000 members. The partnership enables both companies to reach a broad, captive audience already actively purchasing food over the Internet. The success of a one-month trial promotion in the Chicago market led to the agreement.

"We are excited to be working with Food.com, a company that shares our vision of leveraging the Internet to make life easier for today's time-starved consumer," said Michael Brennan, Peapod Vice President of Marketing and Product Management. "Both companies present an efficient, less labor-intensive alternative to grocery shopping and food preparation."

"Partnering with Peapod is a great fit for Food.com," said Karen Orton, Vice President of Business Development at Food.com. "Our customers share the same interest in utilizing the choice, control and convenience the Internet offers to purchase food and meals online. By working together to provide special offers to customers, we're broadening the options and incentives available to them, as well as reaching additional consumers."

Food.com was founded in December of 1996 and is the largest service of its kind offering home and business meals on the Internet. With over 12,000 restaurants on the service nationwide and over 650,000 members, Food.com is also the exclusive takeout and delivery partner of America Online. Food.com has been a leader in aggregating the highly fragmented restaurant industry in order to provide consumers with a one-stop shopping site on the Web for food takeout and delivery ordering. Eventually, Food.com intends to expand its offerings to include restaurant reservations, restaurant reviews, sending meals as gifts, specialty food offerings, and news related to food and dining. Food.com can be found on the World Wide Web at www.food.com. Located in San Francisco, Calif., Food.com can also be contacted at [phone].

Peapod, Inc., "Your Personal Grocer & More," is the nation's leading Internet grocer, providing consumers with broad product choices and local delivery services. With 1998 revenues of $69 million, the Company currently provides such services in eight metropolitan markets in the United States and serves approximately 100,000 households. Peapod is also a leading provider of targeted media and research services to consumer goods companies, offering its unique medium for targeting promotions and advertising at the point of purchase and conducting cost-effective research. Peapod can be found on the World Wide Web at www.peapod.com. Located outside of Chicago, Ill., Peapod can also be contacted at (800) 5-PEAPOD.