Modacad Signs $7.5 Million Marketing Pact With AOL

Modacad Inc., creator of styleclick.com, a fashion and style
related e-commerce site, signed a two-year interactive marketing agreement
with America Online.

Under the two-year agreement, Modacad will provide payments to AOL totaling
$7.5 million plus warrants to purchase 100,000 shares in Modacad stock. In
exchange, Modacad’s styleclick.com Web site will be promoted in several areas
of the AOL service including the Shopping Channel, Entertainment and Teen
Channels. Styleclick.com will also be promoted on AOL.com’s Home & Garden WebCenter, and on AOL’s
Instant Messenger service as well as through Keyword: styleclick.

AOL will also be eligible for additional payments once certain thresholds
specified in the agreement have been met and AOL may sell advertising on
behalf of styleclick.com in a revenue sharing agreement with Modacad.

The styleclick.com shopping area specifically designed for AOL members will
offer a range of apparel, accessories and cosmetics from such popular
retailers as Adidas, Crabtree & Evelyn, Danskin, Easy Spirit, Nicole Miller,
Nine West, Patagonia, Timberland and others.

Modacad’s styleclick.com will also have an advertising presence on Oxygen Media, which specializes in
providing branded content for women on the Internet, cable television, and
other media. Financial arrangements of that deal were not disclosed.

“This agreement has enabled Modacad to become a key provider of style content
for AOL and supports our business strategy which provides major sites the
ability to populate their special shopping areas with styleclick.com’s
special merchandise mix,” said Maurizio Vecchione, Modacad’s president and co-chief executive officer.

Styleclick.com offers many products in high resolution with the ability to
pan and zoom in to inspect fabric texture, stitching, buttons and beading.
Featured products can be viewed in 3D.