Sale of element 5 to Digital River

Montgomery & Co. Represents Element 5 Ag in Sale to Digital River, Inc.

Santa Monica, CA - April 19, 2004 - Montgomery & Co., a leading investment bank for emerging-growth companies, today announced it acted as the exclusive financial advisor to element 5 AG in its sale to Digital River, Inc (NASDAQ: DRIV). Based in Cologne, Germany, element 5 is a leading provider of outsourced ecommerce solutions to software publishers. Under the terms of the agreement, Digital River paid $120 million in cash, and may pay an additional $2.5 million in cash based on element 5's operating performance over the first 24 months subsequent to the acquisition. As a result of the acquisition, element 5 becomes a wholly-owned subsidiary of Digital River.

"The combination of element 5 and Digital River creates the dominant worldwide provider of outsourced eCommerce solutions for software publishers," said Gerrit Schumann, CEO and co-founder of element 5. "As we evaluated our strategic options it was clear that joining Digital River was the optimal decision for maximizing the growth of our business while achieving an attractive exit for our investors."

"Montgomery's dedication to the highest quality service was a major factor in making this transaction a success," said Schumann. "Montgomery & Co. thoroughly explored our strategic alternatives and executed the transaction flawlessly. Remarkably, when we first spoke with Montgomery six months ago, they estimated a transaction close date of April 16, 2004. They were only a few hours off."

"The cross-border combination of Digital River and element 5 represents a landmark transaction in the eCommerce services sector," said Kevin Covert, Managing Director at Montgomery & Co. "These two highly successful companies illustrate that the Internet as an international distribution platform is beginning to live up to its original expectations. The management team at element 5 has built a great business and we wish them continued success as part of Digital River."

"In general, M&A activity among software and internet services companies is accelerating. We are having a successful year at Montgomery and are expanding rapidly to address the needs of growth companies in these sectors."

About Montgomery & Co.

Founded in 1986, Montgomery & Co. provides investment banking services to growth companies in the media, communications, information technology, and healthcare sectors. Based in Santa Monica, CA, the firm also has offices in San Francisco, San Diego and Kirkland, WA. Montgomery & Co. is a member of the National Association of Securities Dealers, Inc. (NASD), and its professional associates are registered with the NASD-SIPC. For more information, please visit www.monty.com.

About element 5 AG

Founded in 1996, element 5 is the leading, privately-held provider of outsourced e-commerce solutions for software publishers in over 150 countries. With a significant presence in Europe, element 5 is the second largest worldwide e-commerce outsource provider to software publishers. The company processes over two million transactions annually for more than 10,000 clients. Customers include Abbyy, Business Objects, Copernic, CyberLink, Data Becker, Executive Software, F-Secure, Ipswitch, Kaspersky Labs, Lavasoft, palmOne, Steinberg, Toshiba, Ulead, and Zonelabs. element 5 supports 11 languages worldwide as well as all major currencies and payment methods, and is represented globally with locations in the United States, Germany, the UK, France, Italy, Sweden, Israel, Japan and Singapore.

Case Study

"Montgomery & Co.'s dedication to the highest quality service was a major factor in making this transaction a success. Montgomery & Co. thoroughly explored our strategic alternatives and executed the transaction flawlessly. Remarkably, when we first spoke with Montgomery six months ago, they estimated a transaction close date of April 16, 2004. They were only a few hours off." - Gerrit Schumann, CEO and co-founder of element 5

"European Venture Capital Deal of the Year" - 2004 Finalist

Situation:

Founded in 1996, element 5 was the leading European provider of outsourced eCommerce solutions that allowed software publishers to easily and cost-effectively sell, market and distribute their software over the Internet. The Company provided software publishers with a turnkey outsourced solution that included order management, payment processing, fraud prevention, licensing, physical and electronic fulfillment, hosting, eMarketing, management reporting and multi-lingual customer support. In 2003, element 5 had over 10,000 software publishers and processed over $100 million of transactions.

Challenge:

element 5 was enjoying tremendous growth and building considerable traction in the United States. The Company began receiving significant interest from potential strategic partners, prompting investors to explore a strategic sale as an alternative to investing additional growth capital. The board's goal was to maximize the growth of the business and achieve an attractive return for the Company's shareholders.

Strategic Advice and Positioning:

Montgomery & Co. facilitated discussions with a select group of potential acquirers and generated significant interest in the Company. Montgomery & Co.'s positioning of element 5 as a vendor poised for rapid growth in the electronic software distribution market created significant buyer urgency that led to an attractive valuation.

Diligent Execution:

Montgomery & Co. worked closely with management to identify potential investors, prepare marketing materials and coordinate meetings. Additionally, Montgomery & Co. played an active role in facilitating due diligence, negotiating the transaction and rapidly driving the transaction to a close.

Successful Outcome:

Montgomery was able to achieve an outstanding outcome for all shareholders in an all-cash $120 million transaction with Digital River. Management retained key roles in the Company going forward and have the potential for an additional $2.5 million cash earn out. Digital River acquired its largest competitor, significantly increasing its market share. Digital River's enterprise value increased $300 million on the day the deal was announced.