Quintel Closes Investment in Bluewater and Secures Favorable Pricing for Web Consulting

Business Wire, June 2, 2000

Business Editors

PEARL RIVER, N.Y.--(BUSINESS WIRE)--June 2, 2000

Quintel Communications, Inc. (NASDAQ: QTEL) announced that it has invested $500,000 in Bluewater Information Convergence, Inc., a leading web development and integration company, as part of Bluewater's $10 million private placement of its Series A Convertible Preferred Stock. In connection with this investment, Quintel and Bluewater entered into a preferred pricing arrangement with respect to the consulting and website development services that Bluewater will provide to Quintel and its affiliates over the next 12-24 months. Bluewater has provided all of the web development and data infrastructure support to date for GroupLotto.com, Quintel's free on-line lottery subsidiary.

Commenting on the transaction, Mr. Jeffrey Schwartz, Chairman and Chief Executive Officer of Quintel said, "Bluewater has provided rapid deployment skills combined with quality development and engineering talent during the creation and growth of GroupLotto. These skills demonstrate to us that they are able to execute projects in the internet space in an expeditious and efficient manner. This characteristic should enable Bluewater to emerge as a leader in the rapidly growing field of web integration and consulting." Mr. Schwartz added, "This investment and the related pricing agreement forms the basis for a commitment by Quintel and Bluewater to grow GroupLotto, and to support the development of future Quintel affiliate projects as part of our business accelerator strategy."

Quintel noted that some of the other investors in this $10 million round of financing for Bluewater included FG II Ventures-FGBW, LLC, JEGI Internet Economy Partners, L.P., and iGate Ventures I, L.P.

Commenting on the Quintel investment, Ray Martin, Chief Executive Officer of Bluewater, said, "The investment by Quintel is very important to us. First of all, GroupLotto has been a significant customer of our services to date and this investment, along with the pricing arrangement, provides further incentives for both parties to continue to work together on GroupLotto and other Quintel projects. Second, we regard Quintel's management as astute businessmen operating in the new value-oriented paradigm of the internet industry. Therefore, their investment in Bluewater represents, in our opinion, a validation of our business model."

Quintel Communications, Inc., develops, operates, and invests in Internet-based direct marketing companies. The Quintel Network is an alliance of strategic investments and marketing partnerships established by the Company with leading Internet marketing companies, e-tailers and service providers. Together, the companies within the Network have the potential to market thousands of products and services to a detailed database of profiled consumers via direct, permission-based e-mail marketing, on-line promotions, loyalty and incentive programs, and group buying events. Currently, Quintel's growing network of strategic investments and marketing partnerships includes GroupLotto.com, one of the Web's fastest growing free lotteries, Multibuyer.com, itarget.com, skymall.com (NASDAQ: SKYM), The Innovation Factory, Inc., GenerationA.com, mortgage.com (NASDAQ: MDCM), CyberGold (NASDAQ: CGLD), LCS Golf, Inc. (OTCBB:LCSGE), and now Bluewater.

Bluewater Information Convergence, Inc. provides data center outsourcing and related consulting solutions that effectively address Day 1 (implementation) and Day 2 (ongoing operations) solutions for emerging, medium and large-sized companies. To address these needs, Bluewater has created the ICON Center - an outsourced data center solution that provides the physical, technical and production management services, to predict and cost-effectively manage the operation of business systems and their servers in a 24x7, world-class, data center environment.

This release contains certain forward-looking statements and information relating to Quintel that are based on the beliefs of Quintel's management, as well as assumptions made by and information currently available to the Company. Such statements reflect the current views of the Company with respect to future events and are subject to certain assumptions, including those described in this Release. Should one or more of these underlying assumptions prove incorrect, actual results may vary materially from those described herein as anticipated, believed, estimated or expected. The Company does not intend to update these forward-looking statements prior to announcement of its fiscal 2000 results.

This release and prior releases are available on the KCSA Public Relations Worldwide website at http://www.kcsa.com/ .