Completes $10M Financing

Enterprise messaging ASP Inc., (NASDAQ: MAIL) today (Jan 10) announced it has raised $10 million in gross proceeds through the issuance of senior convertible notes to Federal Partners, L.P. and accounts managed by Zesiger Capital Group LLC. In connection with the financing, the Board of Directors of has appointed Stephen M. Duff, the designee of Federal Partners, as a director.

“We are pleased that investors with a long-term orientation such as Federal Partners and Zesiger Capital believe that investing in represents such an attractive opportunity.” said Thomas Murawski, CEO. “Having recently announced a plan to shed non-core assets and to focus exclusively on our core messaging business, this cash will contribute to the execution of our business plan in 2001.”

In October, Inc. announced that it was getting out of the online advertising business to focus on messaging. Amid announcing losses that were in line with expectations, the Silicon Alley company also said it would sell its advertising network business, which provided email-based advertising and permission marketing services. The strategic shift also included an executive reshuffling.

The notes mature on January 8, 2006 and carry a 10.0% coupon payable semi-annually. One half of the interest payments are payable in Class A common stock valued at the then applicable conversion price until 18 months after the date of issuance, and thereafter one half of the interest payments are payable at the option of the Company in such shares so valued. The notes are convertible, at the option of the holder, into shares of Class A common stock of the Company at a conversion price of $1.00 per share, subject to anti-dilution adjustments. The notes are non-callable for three years except under certain conditions and are secured by the Company’s share ownership of

The net proceeds from the offering will be used for working capital and other general corporate purposes.

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