Date: December 14, 2004

To: Our-Hometown, Inc Customers

Subject: Traffic charge reduction and revenue opportunities.

You'll notice that on your bill this month we've changed the metric on which we base our charges for traffic to your website and the distribution of third party ad revenues. The net impact is a reduction in traffic charges of over 33% and because the same percentage of third party ad revenues is being distributed but based on lower numbers, there is minimal net impact caused by the changed distribution. Every customer will see a reduction in traffic charges and overall third party ad revenues have not changed.

We changed from page views to document views for three reasons. First, the primary reason for the traffic charge was due to anticipated increases in costs to service rapidly growing traffic to all websites. Although traffic continues to increase, our costs have not grown as quickly as we originally anticipated.

The second reason we've changed the metric is the page view numbers reported on the Webtrends reports have never matched the numbers reported by the third party ad provider. The reasons are complex but it has to do with the numbers of old browsers still being used, some people disable Java, the spider filter is not perfect and some quirks specific to our system. Our research has shown that document views more closely represent human interaction with the websites and are closer to the numbers reported by the third party ad provider.

The third reason is a promise we made to reduce our percentage of the third party ad revenues over time. We fundamentally believe that all ad revenue belongs to the publisher but in order to offset our costs of implementing and maintaining the program, as well as eliminating the need for any price increases over the last few years, we take part of these revenues. Although this pricing change doesn't actually change our percentage, the net impact is to reduce fees, which has the same net impact as a reduction in our percentage. This change also addresses the minor inequities that resulted from the disparity in page views reported by the third party ad provider and Webtrends.

I'd like to close this letter by pointing out the success most of our new customers are having by sending ALL of their display ads and charging their advertisers for it. A fairly recent improvement in our system now allows the display ads to be found on the search engines based on the words in the ad. This adds to the advertiser benefit we've been providing from day one, which is a 1.6% Click Through Rate (CTR) from the preview versions of the display ads to the full size ad. This indicates that users of the website are interested in the advertiser's products and services and it far exceeds the industry standard for web banner ads which typically is less that 0.5%.

Furthermore, we passed a major milestone last year, the total revenues from print and online subscriptions, classified orders and third party ad revenues now exceed our total charges to publishers. Several existing customers are not taking advantage of all these new revenue sources in spite of the fact that only sometimes there is a minor setup charge for these features, new customers pay nothing if implemented in the initial setup period. Unfortunately, these "no effort" revenue sources don't exceed our fees for all of our customers yet because those with strong classified sections and larger market sizes tend to benefit the most from these features.

I strongly suggest that you consider increasing your utilization of your website in 2005. For those that perhaps are unaware of all the features available to them, the "FAQ" button on www.our-hometown.com is a great resource. You can always call us to discuss the features available and find out some of the exciting revenue sources we're planning for 2005.

Sincerely,

Stephen Larson

President