Knot, WeddingChannel.com agree to merge

JUNE 06, 2006 - New York -- The Knot and WeddingChannel. Com have agreed to merge in what would be a marriage between two leading Web sites for bridal consumers. The Knot, a publicly traded company, will pay $57.9 million in cash and issue 1,150,000 shares of its common stock in exchange for all of the capital stock and stock options of WeddingChannel, which is privately held, a joint press release said."We look forward to leveraging the complementary strengths of our two businesses to better serve the needs of our audience and, by doing so, we will become a more effective marketing resource for our advertisers," David Liu, Chairman and CEO of The Knot said in a press release issued Monday.

"Together, our unique businesses will enhance our offerings for the wedding market and further cement the relationships we establish with our members."Wedding Channel CEO Adam Berger said the companies have taken different paths to satisfy the bridal market, but will work better by teaming up. "By joining forces, we are better positioned to offer the best products and services to the broadest audience and create more lifestage opportunities," he said in the release. The Knot intends to finance the cash portion of the purchase price through a follow-on offering of its common stock, pursuant to a registration statement the company expects to file within the next month.

If The Knot elects not to complete the offering, the company will pay $28 million in cash and issue 3,200,000 shares of its common stock in exchange for all of the capital stock and stock options of WeddingChannel. An adjustment will be made to the cash portion of the purchase price if WeddingChannel's working capital is above or below $10 million at closing. The boards of directors for both companies have signed off on the merger.

Stockholders representing approximately 30 percent of the outstanding capital stock of WeddingChannel have agreed to vote their shares in favor of the merger.