Random House announces co-publishing and licensing agreement with Interactive Imaginations, creators of the interactive entertainment world wide web site, www.riddler.com; Deal includes equity investment by Random House

Business Wire, April 22, 1996

NEW YORK--(BUSINESS WIRE)--April 22, 1996--Random House Inc. and Interactive Imaginations Inc. today announced a co-publishing and licensing agreement to produce interactive puzzles to appear on riddler.com, the acclaimed entertainment site created by Interactive Imaginations for the World Wide Web.

It was also announced that Random House is making an equity investment in Interactive Imaginations, its first such investment in an Internet-based company. Terms were not disclosed.

Random House Inc., the world's largest English-language general trade book publisher, has also established a leading position in the multimedia field. It maintains an extensive puzzle book publishing program through its Times Books imprint.

Interactive Imaginations Inc. produces riddler.com (http://www.riddler.com), one of the most popular sites for interactive entertainment on the World Wide Web.

Alberto Vitale, Chairman and Chief Executive Officer of Random House Inc. said, "We are very pleased to be entering into this relationship with such an innovative company as Interactive Imaginations. By creating a model for the Web that uses content in a dynamic and intriguing way, they have established a truly pioneering business that is well poised for growth."

Michael Paolucci, President and Chief Executive Officer of Interactive Imaginations Inc. commented, "Random House is one of the major sources of quality content in the world today. This alliance creates a powerful combination, by bringing together Random House's editorial expertise with our creative and technological ability to deliver on the Web."

Under the co-publishing arrangement, Stanley Newman, Managing Director of Puzzles and Games at Times Books, will oversee the creation of original puzzles for the Riddler site. Under the licensing agreement, a select number of Random House Crossword Puzzles will be featured in two new games: Gridlock, a single-player game, and Checkered Flag, a multi-player game in which players compete for prizes.

"We welcome the challenge to create new types of puzzle experiences for this new and fast-expanding medium," said Stanley Newman.

Randi Benton, President of Random House New Media commented, "This relationship marks another milestone in our new media activity. Interactive Imaginations is an ideal partner to help extend our publishing program to the World Wide Web."

The licensed Random House Crossword Puzzles will begin appearing in late-April on the Riddler site (http://www.riddler.com/rhpuzzles). The newly created puzzles will begin appearing later this year.

Founded in 1925, Random House Inc. includes an array of prestigious imprints that publish some of the foremost writers of our time in hardcover, trade, paperback, mass market paperback, and other formats.

Random House Inc.'s current operations are divided into ten divisions: the Random House Publishing Group, including Times Books (which in addition to puzzles and games, also publishes books on politics and current affairs health science, and business); Random House New Media; the Knopf Publishing Group; the Crown Publishing Group; the Ballantine Publishing Group; Random House Reference and Information Publishing; the Random House Juvenile and Merchandise Group; Random House Direct Marketing; and Random House Value Publishing. The impact of Random House's publishing program is worldwide, and its International Group includes companies in Canada, the United Kingdom, Australia, New Zealand and South Africa.

The New Media division, founded in 1993, has established relationships with leading multimedia companies including: Living Books, a joint venture with Broderbund Software Inc.; Knowledge Adventure; and Humongous Entertainment.

Interactive Imaginations was founded in September 1994 by Michael Paolucci and John Waller, and was one of the first new media companies headquartered in New York's Silicon Alley. The company is privately held and plans to develop a diverse portfolio of entertainment offerings for the World Wide Web. Its Riddler site, the first stand-alone web site built specifically to gain support from national advertisers, pioneered one-to-one marketing on the Web.

CONTACT: Random House Inc.

William T. Loverd, 212/572-2103

wloverd@randomhouse.com

or

Interactive Imaginations Inc.

Ken Kerrigan, Edelman Public Relations

212/704-8155

kkerriga@mail.edelman.com