eB2B Completes Acquisition of Bac-Tech Systems, Inc.

Accretive Transaction Strengthens Market Position

New York, New York, UNITED STATES


NEW YORK, Jan. 3, 2002 (PRIMEZONE) -- eB2B, Inc. (Nasdaq:EBTB), a leading provider of business-to-business transaction management services, announced today that it has acquired New York-based Bac-Tech Systems, Inc. Bac-Tech offers comprehensive EDI and Web-based services to a growing portfolio of nationally known suppliers, including O-Cedar Brands, Peregrine Outfitters, Schott Glass and Ross Products, a division of Abbott Labs. The transaction broadens eB2B's customer base and distribution channels, leverages eB2B's revenue model and adds depth to eB2B's management team.

The transaction was structured as a merger, with Bac-Tech's principals receiving $250,000 cash at closing and 8 million shares of common stock and common stock equivalents. Additionally, the principals received notes in the aggregate amount of $600,000 payable in equal installments in 2003, 2004 and 2005 and may earn a $200,000 performance-based payment in 2002. Both principals have signed three-year employment agreements with the company.

Both companies automate business transactions between retailers, suppliers and manufacturers such as purchase orders, invoices, advance shipping notices and acknowledgements using traditional Electronic Data Interchange (EDI) technology as well as newer, browser-based methods using the Internet. Bac-Tech has focused its model on providing solutions from stand-alone software to hosted application services to total outsourcing for larger suppliers in broad markets, while eB2B has directed its energies to providing larger retailers a Web-based solution for their small and medium suppliers in targeted vertical markets.

Richard Cohan, eB2B's CEO commented, "The combination of eB2B and Bac-Tech leverages the core competencies of both companies. Bac-Tech's EDI expertise coupled with their hosted solutions for mid-size retailers and suppliers complement eB2B's Web-based subscription service for smaller enterprises. Together, the companies will focus on selling an expanded set of services to both existing and new customers, as well as integrating their technologies with other partners. As we realize cost synergies through the combination, our fixed cost base will only increase moderately as we grow our revenue, expanding our cash flow and operating profitability."

Robert Bacchi, Bac-Tech's President said, "We are very pleased to join the eB2B family. Given eB2B's marquee customer base, and current market traction, we are better positioned together to deliver additional value to retailers and suppliers. With our combined knowledge and an integrated product approach we can deliver the best of both companies' technology, products and support."

"Equally important, our acquisition of Bac-Tech is a signal that our efforts to reshape eB2B for growth are working," Cohan added. "We have completed our restructuring, we will be cash flow positive from operations in December, as promised, and we have secured additional financing to grow our business. Now, we've completed an accretive acquisition, as well as adding two accomplished e-commerce executives to our team. Our combined sales pipeline is very strong, and we are perfectly positioned to grow revenue and cash flow. This transaction strengthens our confidence in our 2002 projection of $12 million in revenue and expanding cash flow profitability from operations in each quarter of the year."

About Bac-Tech Systems, Inc.

Bac-Tech's principals, Robert Bacchi and Michael Dodier, founded the company as an IT consulting firm in 1981 and have been exclusively focused on supply chain solutions since 1996. Bac-Tech sells its solution either as a licensed product or as a hosted (ASP) service.

About eB2B, Inc.

eB2B Commerce is a leading provider of business-to-business transaction management services that simplify trading partner integration, automation and collaboration across the order management life cycle. The eB2B Trading Network and Transaction Lifecycle Management solutions provide enterprises large and small with a total solution for improving trading partner relationships that enhance productivity and bottom line profitability.

Certain statements contained in this news release which are not based on historical facts are forward-looking statements, as the term is defined in the Private Securities Litigation Reform Act of 1995, and are subject to uncertainties and risks that may cause actual results to materially differ from projections. Although eB2B believes that its expectations are reasonable assumptions within the bounds of its knowledge of its business operations, there can be no assurance that actual results will not differ materially from its expectations. The uncertainties and risks include, among other things, the Company's plans, beliefs and goals, the Company's limited operating history, the ability to raise additional capital, if needed, the risks and uncertainties associated with rapidly changing technologies such as the Internet, the risks of technology development and the risks of competition that can cause actual results to differ materially from those in the forward-looking statements. The Company undertakes no obligation to revise or publicly release the results of any revision to these forward-looking statements.


        

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