Interland Gains Leadership in Mass-Market Web Solutions
for Small Businesses By Signing to Acquire Trellix
Combination Targets 20 Million Small Businesses
ATLANTA, December 11, 2002 Interland, Inc. (Nasdaq: INLD), the leading provider of business-class Web hosting services
to small and medium businesses, today announced it has begun the implementation of its mass-market growth strategy with the
acquisition of Trellix Corporation, the leading developer of software-based Web site solutions. The transaction consideration
consists of $9.75 million in cash and stock plus warrants. In return for all the outstanding shares of the company, Trellix
shareholders will receive $4.75 million in cash, three million shares of Interland stock, and a five-year option to purchase
up to six million additional shares of Interland at a price of $5.00 per share. The transaction is expected to close within
the next 30 days.
Earlier this year, Interland announced plans to develop a strategy to reach the small-business mass market. Based on industry
analyst firm Yankee Group estimates, there are more than 20 million small businesses and home offices in the United States,
and the vast majority of them do not have a professional or effective Web presence. We believe that the addition of Trellix
provides our company with, hands-down, the industrys best technology foundation necessary to attack this huge mass-market
opportunity, said Joel J. Kocher, Interland chief executive officer.
Through our mass-market strategy we are creating an opportunity to reach a much broader audience of small businesses and
one that no one else is reaching effectively. Interland will be able to offer a unique blend of service and technology by
combining its market leadership and revolutionary blueHALO hosting platform with Trellixs technology and significant distribution
relationships, said Kocher.
The current Web hosting market can be characterized as early adopter, generally more technically savvy than the average
small-business owner, according to Yankee Group research analyst Helen Chan. There is a very large market opportunity as most
small businesses and home offices do not have a Web site, said Chan. By acquiring Trellix, Interland is poised to be a leader
in both the early adopter market and the small-business mass market. This move will help broaden Interland from a Web hosting
service company to a Web solutions provider for SMEs.
Over the past five years, Trellix has developed an industry-leading set of Web solutions for small businesses to establish
their Web presence and to grow their businesses. Trellix products have won multiple awards, and over four million Web sites
have been built on its platform, including hundreds of thousands of small-business Web sites.
"This merger is a wonderful combination," said Trellix founder and chief technology officer Dan Bricklin. "Small businesses
must have access to all of the online aspects of doing business today to find and serve their customers. Unlike big businesses,
they have no data centers and no dedicated IT staff. They need someone else to do all this on their behalf. Together, we can
provide software tailored to small-business needs, tightly integrated with facilities manned 24x7."
Trellix provides all the applications and services a small business needs to establish a highly successful online presence.
Trellix offers an integrated suite of innovative tools including Web site publishing, online marketing, assisted site-building
services and e-commerce. Trellixs industry-leading technology includes a suite of building tools and hundreds of SME industry
vertical templates and designs. These products provide a superior user experience, unmatched flexibility, power and ease-of-use.
The traditional Web hosting market is littered with technical offerings that bewilder everyday small businesses, said Don
Bulens, CEO of Trellix. As part of Interland, we will deliver the sensible, easy-to-manage solutions that these companies
can use to succeed online.
Based on the strength of its solutions, Trellix has established distribution relationships with over 50 strategic partners.
Additionally, Interland and Trellix are currently partners in providing Web solutions to Verizons small-business customers.
Bricklin and Bulens have accepted executive positions with Interland, and are expected to continue to lead the Trellix
operation. Trellix has a team of highly experienced software developers who have repeatedly produced market-leading products
that are heralded for their ease-of-use. The team's accomplishments include breakthrough innovations in Web and PC applications,
such as spreadsheets and presentation graphics, electronic and Web site publishing, and e-commerce.
Interland management will comment further on the strategic implications of this transaction during its upcoming first quarter
fiscal year 2003 earnings announcement and analyst conference call to be held on Thursday, December 19, 2002 at 4:30 p.m.
Interland, Inc. (Nasdaq: INLD) is the leading provider of business-class Web hosting solutions for small and medium businesses,
offering a broad portfolio of standardized Web hosting, e-commerce, and application hosting services, from basic Web sites
to managed dedicated hosting solutions. More information about Interland can be found at www.interland.com.
Founded in 1995 by technology visionary Dan Bricklin, Trellix is the leading provider of private-label Web site publishing
solutions, integrated business services, and proven low-cost hosting technology. Trellix offers a suite of site building tools
and services that enable users to easily create compelling, professional Web sites -- regardless of technical ability. Trellix
investors include Accel Partners, Bessemer Venture Partners, Charles River Ventures, Dell Computer Corporation, Goldman Sachs,
HarbourVest Partners, Lycos, Inc., and Matrix Partners. More information about Trellix can be found at www.trellix.com.
The foregoing contains "forward-looking statements" which are based on management's beliefs
as well as on a number of management assumptions concerning future events and on information currently available to management.
Such forward-looking statements are not a guarantee of performance and are subject to a number of uncertainties and other
factors, many of which are outside Interland's control, which could cause actual results to differ materially from such statements.
Statements regarding the future financial results expected to result from an acquisition are dependent upon the accuracy of
numerous assumptions and projections relating to transition and integration costs and other factors, and no assurance can
be given of the accuracy of such statements. For a more detailed description of factors that could cause a difference between
forward-looking statements and actual results, please see Interland's most recent Form 10-K, Forms 10-Q and Forms 8-K and
other filings with the Securities and Exchange Commission. Interland disclaims any intention or obligation to update or revise
any forward-looking statements, whether as a result of new information, future events or otherwise.