EXHIBIT 99.3

        SECTION CAPTIONED "RISK FACTORS" CONTAINED IN NETCREATIONS, INC.
        ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 1999
                        (COMMISSION FILE NO. 001-14875)

     You should carefully consider the following risks before you decide to
invest in our company. If any of the following risks actually occur, our
business, financial condition or results of operations may suffer. As a result,
the trading price of our common stock could decline, and you may lose all or
part of your investment.

WE DEPEND ON CONTINUED GROWTH IN USE OF THE INTERNET FOR E-MAIL DIRECT MARKETING
AND E-COMMERCE.

     The business of e-mail direct marketing and e-commerce is new and rapidly
evolving. Our business would be adversely affected if Internet usage for the
exchange of information and for commerce does not continue to grow because
advertisers might feel less compelled to use our services as opposed to more
traditional advertising services. Internet usage may be inhibited for a number
of reasons, such as:

        o inadequate network infrastructure;

        o security concerns;

        o inconsistent quality of service; and

        o lack of availability of cost-effective, high-speed service.

THE ACCEPTANCE AND EFFECTIVENESS OF INTERNET OPT-IN E-MAIL DIRECT MARKETING IS
RELATIVELY UNPROVEN.

     Our future success will depend on an increase in the use of the Internet as
an opt-in marketing medium or for opt-in e-mail generally. The opt-in e-mail
direct marketing industry is new and rapidly evolving. Consequently, current
indications of its effectiveness compared to traditional postal direct marketing
may not be supported as the industry matures. As a result, there generally is
significant uncertainty about the demand and market acceptance for opt-in e-mail
marketing solutions or Internet advertising solutions.

     Many of our current or potential customers may have little or no experience
using the Internet for direct marketing purposes. The adoption of Internet
direct marketing, particularly by those entities that have historically relied
upon traditional media and mailings for marketing, requires the acceptance of
a new way of conducting business. These companies may find e-mail direct
marketing to be less effective for promoting their products and services as
compared to traditional mass media and postal marketing.

     We cannot assure you that the market for e-mail direct marketing will
continue to emerge, or will become sustainable.







INTERNET, SOFTWARE OR HARDWARE FAILURES OR SHORTCOMINGS COULD ADVERSELY AFFECT
OUR BUSINESS IN DIVERSE WAYS.

     We depend on software, hardware, and the Internet to collect, store,
retrieve and process e-mail addresses and other data and to send e-mail for our
direct marketing customers. The third-party websites which we rely upon to
collect e-mail addresses are less likely to collect additional e-mail addresses
for us if their operations are disrupted or slowed by Internet, software or
hardware failures or shortcomings or if such occurrences discourage potential
visitors from using the Internet or visiting their sites. Direct marketers are
less likely to utilize our services if potential customers are prevented or
discouraged from using the Internet and receiving promotional messages due to
Internet, software, or hardware failures or shortcomings.

     Many of the Internet service providers and Web site operators on whom we
depend have experienced significant service slowdowns, malfunctions, outages and
capacity limitations. We also depend upon the reliability, speed, data capacity,
ease of use, accessibility and security of the Internet as well as its continued
development and acceptance for commercial use generally.

     The Internet infrastructure may not be able to support the increasing
demands placed on it at acceptable service levels as Internet usage grows. An
individual's satisfactory Internet experience may also depend on the proper
functioning and the continued development of equipment such as high speed
modems and personal computers. Not all software and equipment protocols and
standards are compatible. Users may experience difficulties due to computer-
related, telecommunications, or other equipment, software, or system failures
or shortcomings unrelated to our services.

     In addition, some of our systems' infrastructure is not yet supported by
redundant servers. Any failure in our system that is not backed up by redundant
servers could cause significant delays in our business operations.

     If we experience a temporary or permanent business interruption, whether
due to casualty, an operating malfunction, a power outage or otherwise, we may
have to reconfigure our software, hardware and Internet infrastructure to
address our customers' needs and orders. We may be unable to do so effectively
or rapidly enough to avoid loss of business or damage to our reputation. Any
interruption of service would be potentially harmful to our business and
reputation because even a short interruption in the midst of performing a
time-sensitive project for a customer could be very damaging to our relationship
with that customer. In certain instances, such as power outages or Internet
service provider outages, we may be unable to do anything other than wait for
the restoration of service and suffer the consequences of business interruption.

YOU MAY HAVE DIFFICULTY EVALUATING OUR BUSINESS AND PROSPECTS OR PROJECTING OUR
FUTURE OPERATING RESULTS BECAUSE WE HAVE A RELATIVELY LIMITED OPERATING HISTORY
AND WE WILL ENCOUNTER RISKS AND DIFFICULTIES AS AN EARLY-STAGE COMPANY IN A NEW
AND RAPIDLY EVOLVING MARKET.

     We have been in the business of providing Internet marketing services since
we commenced operations in 1995. During 1996, our principal service offerings
transitioned from that of Web site design and promotion to opt-in e-mail
marketing services. It is unlikely that the growth rates we have experienced


                                       2





are sustainable as our business and the market for opt-in e-mail marketing
services mature and more competitors enter the field.

     We will encounter risks and difficulties frequently experienced by
early-stage companies in new and rapidly evolving markets, including our
ability to:

        o anticipate and adapt to our evolving market;

        o implement sales and marketing initiatives;

        o develop and introduce new products and services;

        o enhance our brands;

        o attract, retain and motivate qualified personnel;

        o respond to actions taken by our competitors;

        o effectively manage our growth by building a solid base of management;

        o operations and technology; and

        o integrate acquired businesses, technologies and services.

     We may not successfully address any of these risks.

OUR QUARTERLY OPERATING RESULTS MAY FLUCTUATE SEASONALLY SO THE RESULTS OF
ONE QUARTER ARE NOT NECESSARILY INDICATIVE OF RESULTS IN THE SUCCEEDING QUARTER
AND THE PRICE OF OUR SECURITIES MAY FLUCTUATE IN RESPONSE TO THOSE FLUCTUATIONS.

     The traditional postal direct marketing industry tends to have higher
revenues in the fourth quarter of the year, when direct marketers send out
holiday promotions, and somewhat lower revenues during the summer, when direct
marketing activity is reduced overall. To date, because of the rapid growth of
the e-mail direct marketing industry, our revenues have grown sequentially
from quarter to quarter. Therefore, our revenues have not followed the seasonal
patterns of the traditional postal direct marketing industry. We anticipate,
however, that as our business matures, our revenues will track more closely
the seasonal patterns experienced in the traditional postal direct marketing
industry.

OUR FUTURE REVENUES ARE UNPREDICTABLE, AND OUR FINANCIAL RESULTS MAY FLUCTUATE.

     Our historical financial data is not reliable as a basis upon which to
predict our future revenues or operating expenses for a number of reasons,
including our limited operating history, the emerging nature of our industry
category, and our growth strategy. Furthermore, there is no guarantee that the
seasonal fluctuations that we have experienced in our operating results to date
will continue as before as our business and the industry evolve and grow.

     Our financial results may fluctuate significantly because of several
factors, such as the following, all of which are beyond our control except
for the incurrence of expenses:

        o Revenues in any quarter are substantially dependent on orders booked
          and delivered in that quarter;


                                       3






        o Demand by direct marketers for use of opt-in e-mail addresses in our
          database may fluctuate due to seasonal and cyclical marketing
          campaigns;

        o The market in which we compete is relatively new and rapidly evolving;

        o We expect to increase our expense levels in the near future in an
          attempt to grow our database and our market share more rapidly. As a
          result, any delay in generating or recognizing revenues could cause
          significant variations in our operating results from quarter to
          quarter and could result in operating losses;

        o The relatively new industry in which we are engaged has not been
          tested in a recessionary economic environment where budget constraints
          and contraction in income available for discretionary purchases could
          reduce the use of our services;

        o Competition is increasing in our industry, and we anticipate that this
          could result in changes in our sales, pricing policies or expenses or
          those of our competitors; and

        o General economic conditions and economic conditions specific to the
          Internet and the online direct marketing industry may vary.

THERE IS NO ASSURANCE THAT WE WILL CONTINUE TO BE PROFITABLE, AND WE MAY INCUR
LOSSES IN THE FUTURE.

     We had net income of $4,531,508 in 1999, $605,863 in 1998 and $260,349 in
1997. We were an S corporation through November 15, 1999. On a pro forma basis,
to adjust net income as if it had been fully subject to Federal, state and city
taxes as a C corporation, rather than an S corporation, we had net income of
$2,940,508 in 1999, $362,091 in 1998 and $154,377 in 1997. As of December 31,
1999, we had retained earnings of $907,866 and shareholder's equity of
$45,262,021. However, we may not be able to sustain our current levels of
profitability and may incur losses in the future.

     We expect to increase our expenditures on sales and marketing, research and
development, and general and administrative expenses in order to expand our
business. If we acquire other businesses in connection with our planned
expansion, we may have to record goodwill or other intangible assets or in
process research and development associated with any such acquisition.
Intangible assets would be amortized over their estimated useful lives, while in
process research and development would be written off at the date of
acquisition. Increased competition in our industry may also adversely affect our
profitability as may other conditions which may be beyond our control. In
addition, many of our direct marketing customers are not profitable and may not
have resources available in the future to rent our lists or pay for our
services.

CHANGES IN OUR COMMISSION POLICIES MAY RESULT IN REDUCED MARGINS OR NEGATIVE
IMPACTS ON OUR CASH FLOW.

     In a small number of cases, primarily involving websites that we believe
are well-known to both consumers and our direct marketing customers, we have
agreed to pay advance fees to the Web site. In those cases, we generally, but


                                       4





not always, have the right to offset against those payments any payment of the
percentage of fees that may become payable to the Web site in the future if an
e-mail address it owns is used for a particular e-mail marketing campaign. In
a few cases, we pay third-party websites flat fees for the collection of e-mail
addresses for inclusion in our database instead of paying a percentage of the
fee from direct marketing customers to those websites. Advance payments burden
our cash flow and might prevent us from making other expenditures that might
generate revenues or growth for us. Our net income would be negatively affected
if a list management arrangement is not profitable enough for us to earn amounts
sufficient to offset advance payments, or if a list management arrangement is
terminated before we are able to earn amounts sufficient to offset advance
payments.

     We typically pay Web site owners commissions amounting to 50% of the
revenue we earn, less volume discounts, if applicable, each time we send an
e-mail message to any e-mail address list owned by that Web site owner. However,
competitive pressures or strategic or other reasons may cause us to make advance
payments or pay commissions of more than 50% of the revenue from sending e-mail
messages to e-mail address list owners in the future. If we pay to our Web site
owners a higher rate of commissions or make advance payments that are not
recovered, our margins will be reduced. We may have reduced profits or may
become unprofitable if any increase in the amount of unrecovered advance
payments to Web site owners or the rate of commissions paid to Web site owners,
and the consequent decrease in our margins, is not offset by lower general and
administrative costs as a percentage of revenues or increased revenues from
other sources.

IF OUR DIRECT MARKETING CUSTOMERS CEASE TO DO BUSINESS WITH US, WE MIGHT BE
UNABLE TO REPLACE LOST REVENUES.

     We have no long-term contracts with any of our direct marketing customers.
There is no guarantee that any of the direct marketers who have previously used
our services will use our lists in any particular quarter or that they will
continue to use our lists in the future. Substantially all of the contracts with
our direct marketing customers can be terminated on short notice without
penalty.

WE ARE DEPENDENT ON THIRD PARTIES TO GENERATE A SUFFICIENT NUMBER OF E-MAIL
ADDRESSES AND, IF THEY TERMINATE THEIR AGREEMENTS WITH US, OUR BUSINESS COULD BE
SERIOUSLY HARMED.

     We depend on our network of third-party websites to post sign-up forms on
their sites and encourage visitors to their sites to sign up to receive
commercial e-mail messages from our direct marketing customers about topics of
interest. Several high-traffic sites with which we signed agreements in the past
have not been successful in generating significant numbers of opt-in e-mail
addresses for our database. Furthermore, the sites in the network:

        o are not within our control;

        o may incorporate into their websites the sign-up forms of other e-mail
          marketing companies in addition to or in place of our sign-up form;
          and

        o are not obligated to continue to build lists for us.



                                       5






     Net revenues generated from the e-mail address lists of two of the websites
in our network accounted for approximately 15% and 24% of our total net revenues
during 1998 and 1999, respectively. Loss of these e-mail address lists could
materially adversely affect our business, financial condition and results of
operations.

     We intend to increase the size of our database through partnership
agreements with high-traffic websites, but there is no assurance that we will do
so in timely fashion or at all. Our increasing expenditures to develop this
channel could materially adversely affect our operating margins and our cash
flow. If we fail to successfully implement this strategy, our business,
financial condition and results of operations could be materially adversely
affected.

THE INTERNET USERS WHO SIGN UP TO RECEIVE OUR MAILINGS CAN OPT OUT, OR REMOVE
THEMSELVES FROM OUR LISTS, OR MAY CHANGE THEIR E-MAIL ADDRESSES AT ANY TIME.

     We provide detailed instructions at the top of every e-mail message we
send out allowing Internet users to remove themselves from our lists. Because
this is a new business model, we do not know how long the average Internet user
will stay on our lists or how many mailings they will accept before opting out.
Currently, the opt-out rate is less than one percent on any given mailing.
However, as more and more marketers use our lists and send out offers, the
number of mailings sent to names on our lists also increases and the number of
those opting out may increase as well. If the rate of list removal requests were
to increase substantially, our fees for the use of our lists could decrease and
our business, financial condition, and results of operations could be materially
adversely affected.

     In addition, it is possible that some of the Internet users in our database
could change their e-mail addresses, thus making some of our direct marketing
customers' messages undeliverable. If a message sent to an Internet user is
returned to us because the e-mail address is invalid, we remove that e-mail
address from our database. If a large number of Internet users in our database
change their e-mail addresses and do not update the information in our database,
or if they delay before opting in again or do not opt in again, then our
business, financial condition or results of operations could be materially
adversely affected.

OUR BUSINESS COULD BE SERIOUSLY AFFECTED BY THE PRIVACY CONCERNS OF INTERNET
USERS.

     Our opt-in e-mail direct marketing service collects consumer preference and
profile information each time an Internet user visits a participating Web site
and volunteers information in response to survey questions. Privacy concerns may
cause users to resist signing up for our lists and providing the personal data
necessary to support the growth and expansion of our database. More importantly,
even the perception of privacy concerns, whether or not valid, may indirectly
inhibit market acceptance of our service.

WE DEPEND ON ADDING TO AND RETAINING OUR MARKETING CUSTOMER BASE.

     We have sent e-mail messages for direct marketing campaigns to e-mail
addresses in our database on behalf of over 1,800 e-mail direct marketing
customers. However, 15 customers accounted for approximately 33% of our net
revenues in 1999. Our ability to attract new marketing customers will depend
on a variety of factors, including the responsiveness, scalability, reliability
and cost-effectiveness of our e-mail marketing services and our ability to
effectively market these services.


                                       6






     Many of our current marketing customers initially use a small number of our
lists for testing purposes. If such a test mailing is successful, the customer
may repeat his mailing to a much larger universe of lists and continue to use
our lists in the future. If we fail to generate repeat and expanded business
from our current and future customers, our business, financial condition and
results of operations would be seriously harmed.

WE RELY ON RESELLERS AND INTEND TO INCREASE OUR RELIANCE ON RESELLERS.

     We intend to increase the proportion of our marketing customers obtained
through our reseller channels, which include e-mail address list brokers,
interactive advertising agencies, Web design firms and websites that attract
small business owners. Such parties are typically referred to as "resellers"
because they place orders in their own names for use of opt-in e-mail addresses
in our database on behalf of their e-mail direct marketing customers. We bill
the reseller our customary fees for use of opt-in e-mail addresses in our
database by their e-mail direct marketing customers, less any applicable
volume discounts, but we also grant a brokerage discount to the reseller. In
1998, resellers were responsible for approximately 38% of our net revenues
and represented approximately 49.5% of our net revenues in 1999.

     While we intend to expand our own sales force, we believe that we can grow
our business more rapidly by relying on the larger aggregate sales force
represented by those reseller channels. If we fail to grow our business,
competitors may be able to enter our industry or find ways to compete more
effectively with us for our customers. Consequently, if we fail to increase the
proportion of our marketing customers obtained through reseller channels, our
business, financial condition and results of operations could be materially
adversely affected.

     Because we give resellers discounts, any sales through resellers will have
lower gross margins than direct sales of the same e-mail addresses. To the
extent we increase the proportion of sales through resellers, our net revenues
and gross profits could decrease. Our agreements with such resellers are
generally not exclusive and, in many cases, may be terminated by either party
without cause. These resellers do not have minimum purchase or resale
requirements. Many of these resellers market e-mail lists that are competitive
with our e-mail lists. These resellers may not give a high priority to the
marketing of our lists or may not continue to carry our lists. They may give a
higher priority to other lists, including their own lists or the lists of our
competitors. We may not retain any of our current resellers or successfully
recruit new resellers.

THE PLANNED EXPANSION OF OUR BUSINESS MAY STRAIN OUR MANAGEMENT SYSTEMS AND
OTHER RESOURCES.

     Since inception, our net revenues have grown from $102,000 in 1995, to $3.4
million in 1998, to $20.7 million in 1999. We had two employees in 1995, 10 at
the end of 1998 and 40 at the end of 1999. The pursuit of our business strategy
may strain upon our current managerial, operational and financial resources.

     We will need to continue to improve our financial and management controls,
reporting systems and procedures. We will also have to continue to expand, train
and manage our work force for marketing, sales and technical support, product
development, and infrastructure management, and manage multiple relationships
with customers and other third parties. We also plan to expand the geographic
scope of our customer base and operations. We will need to continually expand


                                       7






and upgrade our technology infrastructure and systems and ensure continued
high levels of service, speedy operation, and reliability. To achieve our
objectives, we may acquire technologies or products or enter into strategic
alliances or acquisitions, although we have no plans or agreements to do
so at the present time.

     Much of our management team is relatively new to our company and has a
short history of working together. Four members of our management team,
consisting of our President and Chief Operating Officer, our Senior Vice
President, Sales and Business Development, our Senior Vice President, Marketing,
and our Chief Information Officer, have joined us in the past two months.

WE FACE INTENSE COMPETITION AND MAY BE UNABLE TO COMPETE SUCCESSFULLY.

     The market for our service is intensely competitive, evolving and subject
to rapid technological change. We expect the intensity of competition to
increase in the future. We believe that we must rapidly expand our business
and market share. If we fail to do so, competitors may copy our business
strategy or take other steps to prevent us from achieving our goals.

     Our competitors include other e-mail direct marketing companies;
incentive-based direct marketers; providers of permission-based outsourced
e-mail solutions; e-mail list owners that manage their own e-mail lists
in-house; banner advertising companies; and postal direct marketing companies.
In addition, because there are relatively low barriers to entry in the e-mail
direct marketing business, we expect additional competition from other
established and emerging companies as the e-mail direct marketing business
continues to develop and expand. We expect to face competition in the future
from other companies entering the field as e-mail address list owners,
managers and brokers. Companies that operate banner advertising networks have
entered the e-mail marketing business through acquisitions of competing e-mail
marketing companies.

     Many of our competitors have longer operating histories; significantly
greater financial, technical, marketing and other resources; significantly
greater name recognition; and a larger installed base of customers than we have.
In addition, many of our competitors have well-established relationships with
our current and potential customers, have extensive knowledge of our industry
and are capable of offering complementary services and products that are beyond
the scope of our current business operations but might be attractive to
customers seeking to purchase services in addition to e-mail direct marketing
services. As a result, our competitors may be able to respond more quickly to
new or emerging technologies and changes in customer requirements, or to devote
greater resources to the development, promotion and sale of their services than
we can.

     In addition, current and potential competitors have established or may
establish cooperative relationships among themselves or with third parties to
increase the ability of their services to address customer needs. Accordingly,
it is possible that new competitors or alliances among competitors may emerge
and rapidly acquire significant market share. We also expect that competition
will increase as a result of industry consolidations.

OUR MARKET IS SUBJECT TO RAPID TECHNOLOGICAL CHANGE.

     Our future success depends on our ability to:

        o adapt to rapidly changing technologies;


                                       8






        o adapt our services to evolving industry standards; and

        o improve the performance, features and reliability of our service and
          product offerings in response to competitive product and service
          offerings and evolving demands of the marketplace.

     We cannot assure you that we will succeed in addressing these issues. Our
efforts to upgrade our software or introduce new software may not be completed
in a timely fashion or at all and may result in errors which could seriously
harm us. In addition, the widespread adoption of new Internet networking
technologies or other technological changes could require us to expend
substantial amounts of capital to change our services or infrastructure.
Moreover, these changes may involve new technologies which may not be measurable
by our current methods.

WE EXPECT TO EXPAND OUR OPERATIONS OVERSEAS BUT YOU WILL NOT BE ABLE TO QUANTIFY
THE RISKS ASSOCIATED WITH INTERNATIONAL EXPANSION.

     We intend to pursue international expansion during the next 12 months but
do not have a specific geographic focus, detailed plan for implementation or
schedule to do so at this time. International operations are subject to risks
that may materially adversely affect our business, results of operations and
financial condition. In particular, opt-in e-mail direct marketing might not
become an acceptable form of advertising internationally. In addition, privacy
regulations in some other countries, including the European Union, are more
stringent than in the United States. These regulations could hinder our ability
to collect demographic data on potential consumers, which could have a material
adverse affect on our business. Other risks of international operations are:

        o regulatory requirements;

        o reduced protection for intellectual property rights in some countries;

        o difficulties and costs of staffing and managing foreign operations;

        o political and economic instability; and

        o fluctuations in currency exchange rates.

WE ARE HIGHLY DEPENDENT UPON ROSALIND RESNICK AND RYAN SCOTT DRUCKENMILLER,
OUR FOUNDERS, AND OUR OTHER EMPLOYEES AND THE LOSS OF THEIR SERVICES COULD HARM
US.

     Rosalind Resnick, our Chief Executive Officer and Chairman of our board of
directors, and Ryan Scott Druckenmiller, our Chief Technology Officer and a
member of our board of directors, founded us and are essential to the continued
viability of the business. We have key man life insurance in the amount of $5
million each, and disability insurance in the amount of $3 million each, on Ms.
Resnick and on Mr. Druckenmiller. We cannot assure you that this coverage will
be adequate to compensate us for the loss of services of either one of our
founders.

     Our future success depends on the continued service of our senior
management, sales, marketing, customer service, administrative, and technology
personnel. The loss of the services of one or more of our key personnel could
seriously harm our business, financial condition and results of operations.


                                       9






Although Ms. Resnick and Mr. Druckenmiller, as well as our President, Chief
Financial Officer, our Senior Vice President, Sales and Business Development,
our Senior Vice President, Marketing, and our Chief Information Officer have all
executed and delivered employment contracts with us which will expire late in
2002 or early in 2003, the employees may terminate the contracts at any time
upon 90 days written notice. In addition, the balance of our work force are
employed on an at-will and short-term basis.

     Our future success also depends on our continuing ability to attract, hire,
train and retain other highly skilled managerial, technical, sales, marketing
and customer service personnel in order to accommodate the growth of our
business. In addition, we are likely to need to recruit additional senior
management personnel as our business grows, particularly in the international
arena. Competition for such personnel is intense, and we may fail to retain our
key employees, or attract, assimilate or retain other highly qualified personnel
in the future.

WE MAY NOT BE ABLE TO SUCCESSFULLY PROTECT OUR INTELLECTUAL PROPERTY.

     Although we are a marketing company, we also depend heavily on technology
to operate our business. We have developed proprietary technology to enable Web
site visitors to opt in to receive targeted advertising information from our
direct marketing customers. The software also enables our direct marketing
customers and e-mail address list brokers to target e-mail addresses in our
database associated with persons with specific demographics, and allows direct
marketers to track the response rates to their mailings. We have developed a
double opt-in confirmation system which sends Internet users a confirmation
e-mail message after they have signed up their e-mail address in our database
and requires them to verify that they would like to begin receiving commercial
e-mail messages from our marketing clients. We have filed a patent application
for this technology. We also have know-how and trade secrets, including the
identities and other information concerning our direct marketing customers and
the information in our e-mail address database, which we seek to protect. If we
do not adequately protect our intellectual property, our business, financial
condition and results of operations will be materially adversely affected.

     While we are unable to determine the extent to which piracy of our
technology exists, software piracy can be expected to be a persistent problem.
In addition, the laws of some foreign countries do not protect our proprietary
rights to as great an extent as do the laws of the United States. Our means of
protecting our proprietary rights may not be adequate. Our competitors may
independently develop similar technology, duplicate our technology design
around patents issued to us or our other intellectual property, attempt to
copy aspects of our service, or obtain and use our proprietary information
that we regard as proprietary.

     There has been a substantial amount of litigation in the software industry
regarding intellectual property rights. It is possible that, in the future,
third parties may claim that our current or potential future technologies
infringe upon their intellectual property. We have not performed any
comprehensive analysis of patents of others that may limit our ability to do
business.

     We expect that as the number of products and competitors in our industry
segment grows and the functionality of products in different industry segments
overlaps infringement claims will be made more frequently. Any such claims, with
or without merit, could be time-consuming, result in costly litigation and
diversion of management resources, cause product shipment delays or require


                                       10






us to enter into royalty or licensing agreements. Such royalty or licensing
agreements, if required, may not be available on terms acceptable to us or at
all, which could seriously harm our business, financial condition and results
of operations.


INCREASING GOVERNMENT REGULATION COULD LIMIT THE MARKET FOR OUR SERVICE, WHICH
COULD SERIOUSLY HARM OUR BUSINESS.

     As Internet marketing and commerce evolves, we expect that federal, state
or foreign governments will increasingly adopt laws and regulations which could
hinder the acceptance of the Internet as a communications and commercial medium
or otherwise harm our business. We expect that laws or regulations will be
enacted in various jurisdictions covering issues such as:

        o the transmission of unsolicited e-mail marketing messages;

        o user privacy;

        o content of e-mail messages;

        o quality of products and services; and

        o the solicitation, collection, processing and distribution of
          personal/customer information,

which could adversely affect our business. Such laws and regulations could
adversely affect the demand for our services if direct marketers perceive that
we will be hindered from reaching a substantial targeted audience or that
substantial liability might arise due to technical breaches of such
restrictions, such as limitations on content or transmission. Our own business
exposure might increase substantially if we were to be held responsible for
the content or quality of e-mail messages which we transmit on behalf of our
direct marketing customers. If we are forced to bear additional administrative
burdens in collecting, storing or maintaining data, our expenses would increase
and market conditions might preclude us from passing our increased costs on to
our direct marketing customers. While we seek to respect Web site visitor
privacy and do not send unsolicited e-mail messages to our database, user
privacy laws and regulations might be designed so restrictively as to make it
increasingly difficult to obtain opt-in e-mail addresses or sell the use of
those addresses to our direct marketing customers.

     Laws and regulations regulating the transmission of unsolicited e-mail
marketing messages are being considered by many jurisdictions. Legislation of
that type has recently been adopted by the States of California, Virginia and
Washington, and similar legislation is pending in the State of New York and in
Congress. The Telecommunications Act of 1996 prohibits some types of information
and content from being transmitted over the Internet. The prohibition's scope
and the liability associated with a Telecommunications Act violation are
currently unsettled. In addition, although substantial portions of the
Communications Decency Act were held to be unconstitutional, we cannot be
certain that similar legislation will not be enacted and upheld in the future.
The European Union adopted a Directive on Privacy, effective on October 24,
1998, which establishes minimum standards for the collection and use of personal
identifying information in the European Union and prohibits the transfer of this


                                       11






information to countries whose privacy standards are deemed inadequate.

ROSALIND RESNICK AND RYAN SCOTT DRUCKENMILLER CONTROL US, AND THEIR INTERESTS
MAY CONFLICT WITH YOUR INTERESTS.

     Rosalind Resnick beneficially owns $5,954,500 shares, or approximately
38.4% of our outstanding common stock, and Ryan Scott Druckenmiller beneficially
owns 5,730,035 shares, or approximately 37.0% of our common stock. In addition
to being our founders, Ms. Resnick and Mr. Druckenmiller are executive officers
and members of our board of directors. If Ms. Resnick and Mr. Druckenmiller were
to act in concert they would be able to exercise control over all matters
requiring approval by our shareholders, including the election of directors and
approval of significant corporate transactions. This concentration of ownership
may also have the effect of delaying or preventing a change in control of our
company and of giving Ms. Resnick and Mr. Druckenmiller the opportunity to
substantially impact all matters requiring approval by our shareholders even if
Ms. Resnick and Mr. Druckenmiller do not act in concert.

WE MAY BE SUBJECT TO PRODUCT LIABILITY CLAIMS.

     Errors, omissions or defects in or other performance problems with our
service could result in financial or other damages to our marketing customers
because our marketing customers use our service for time-critical communications
with their prospective customers. Our marketing customers could seek damages for
losses from us. Our license agreements typically contain provisions designed to
limit our exposure to such claims, but the protection afforded by such
provisions is dependent upon the solvency of the parties to our licensing
agreements and existing or future laws or unfavorable judicial decisions could
negate such limitation of liability provisions. We have not experienced any
liability claims to date. However, a liability claim brought against us, even if
not successful, would likely be time-consuming and costly. A liability claim
could materially adversely affect our business, financial condition and results
of operations.

WE MAY BE SUBJECT TO CLAIMS DUE TO THE ACTIVITIES OF OUR CUSTOMERS.

     We cannot predict whether our role in facilitating our customers' promotion
of products and services would expose us to liability. If that should occur, we
could be required to expend significant management and financial resources to
address any such claim or to pay any fines or penalties which might result or we
could be required to alter or discontinue certain methods of doing business or
take other steps which could be materially adverse to our business, financial
condition, or results of operations. Our current insurance may not provide
adequate coverage against claims which could have an adverse effect on our
business.

THE FUTURE SALE OF SHARES OF OUR COMMON STOCK MAY NEGATIVELY AFFECT OUR
STOCK PRICE.

     The 3,795,000 shares sold in our initial public offering are freely
tradable without restriction except for any shares purchased by our "affiliates"
as defined in Rule 144 under the Securities Act. 11,700,000 of our outstanding
shares of common stock are "restricted securities" as defined in Rule 144,
substantially all of which are owned by Ms. Resnick or Mr. Druckenmiller, who
are "affiliates" of the company. We have also granted options to purchase
1,629,500 of our shares of common stock to our employees and our directors
other than Ms. Resnick and Mr. Druckenmiller. Our stock option plan permits


                                       12






the issuance of options to purchase up to 2,000,000 shares of our common stock.

     Those shares may be resold only if there is an effective registration
statement under the Securities Act covering those shares or an exemption from
registration under Rule 144 or otherwise is available. In connection with our
initial public offering, all of our executive officers and directors, including
Ms. Resnick and Mr. Druckenmiller, have agreed that they will not sell any
shares without the prior consent of the representative of the underwriters for a
period of 180 days from November 12, 1999.

     The market price of our common stock could decline as a result of sales by
Ms. Resnick or Mr. Druckenmiller and optionholders of a large number of shares
of our common stock in the market or because of the perception that such sales
could occur. We intend to register all shares of our common stock reserved for
issuance under our stock option plan. Shares covered by such registration will
be eligible for resale in the public market, subject to Rule 144 limitations
applicable to "affiliates" and to the lock-up agreements described above. These
sales also might make it more difficult for us to sell equity securities in the
future at a time and at a price that we deem appropriate.

THE MARKET PRICE OF OUR STOCK MAY BE ADVERSELY AFFECTED BY MARKET VOLATILITY.

     The stock market has experienced extreme price and volume fluctuations,
particularly with respect to Internet-related stocks. The trading price of our
common stock could be subject to wide fluctuations in response to a various
factors, such as the following:

        o fluctuations in our quarterly or annual results of operations;

        o changes in published earnings estimates by analysts and whether our
          earnings meet or exceed such estimates;

        o announcement of significant developments, such as the gain or loss of
          contracts or relationships or innovations or product introductions by
          us or our competitors;

        o additions or departures of key personnel;

        o changes in the rating or price targets of investment research
          analysts; and

        o changes in overall stock market conditions, including the stock prices
          of other Internet companies.

     In the past, companies that have experienced volatility in the market price
of their stock have been the object of securities class action litigation. If we
were subject to securities class action litigation, it could result in
substantial costs and a diversion of our management's attention and resources.


                                       13






WE DO NOT PLAN TO PAY CASH DIVIDENDS EVEN THOUGH WE MADE DISTRIBUTIONS TO OUR
SHAREHOLDERS WHEN WE WERE A PRIVATE COMPANY.

     From the date of commencement of our business through November 15, 1999, we
elected to be taxed as an S corporation under United States federal and state
laws. In connection with that election, we typically made large distributions of
income to our shareholders each year, who were subject to all federal and
substantially all state taxes levied in respect of our earnings. Our
shareholders paid taxes at their personal tax rates on that income and we did
not pay federal corporate income taxes on that income. On November 15, 1999, we
filed a notice of termination of our status as an S Corporation and we have been
taxed since then as a C corporation. As a result, we, rather than our
shareholders, will be taxed on income that we earn since November 15, 1999. We
do not currently intend to pay any cash dividends from or after that date.

CERTAIN ANTI-TAKEOVER PROVISIONS MAY ADVERSELY AFFECT OUR SHARE PRICE AND IMPEDE
"CHANGE OF CONTROL" TRANSACTIONS.

     Our restated certificate of incorporation includes provisions (1) requiring
advance notice to us before nominating any person to be elected a director or
concerning any other matter to be voted upon by our shareholders, (2) precluding
shareholders from taking actions by written consent in lieu of a meeting, (3)
requiring a majority of our shareholders or our president, chairman of our board
of directors or a majority of our board to call a special meeting of
shareholders, and (4) requiring the affirmative vote of at least two-thirds of
our shareholders to amend these provisions. Our bylaws include corresponding
provisions, as well as a provision permitting our board of directors to fill
vacant directorships or increase the size of our board of directors. Section 912
of the New York Business Corporation Law prohibits an "interested shareholder"
from engaging in a "business combination" with us for a period of five years
from the date that person first became an interested shareholder unless certain
conditions are met. Those provisions could, together or separately:

        o discourage potential acquisition proposals;

        o delay or prevent a change in control; and

        o limit the price that certain investors might be willing to pay in the
          future for shares of our common stock.

     In particular, our restated certificate of incorporation permits our board
of directors to issue up to 5,000,000 shares of preferred stock with rights and
privileges that might be senior to our common stock, without the consent of the
holders of common stock. Those rights and privileges could include voting rights
that could effectively eliminate the rights of common shareholders to control us
and direct our affairs.



                                       14