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Changes made at Centerlinq company

February 27, 2002

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LOS ANGELES - GenesisIntermedia Inc. (NASDAQ:GENI) named Stephen Weber interim chief executive officer during a directors meeting on Oct. 8. The company, whose Centerlinq line develops video and interactive advertising kiosks for malls, is dealing with NASDAQ's decision to halt trading in the company on Sept. 28 and a Securities and Exchange Commission (SEC) investigation.

Weber replaced company founder Ramy El-Batrawi, who resigned as chief executive officer and chairman of the board of directors, the company announced. NASDAQ is investigating El-Batrawi's role in stock transactions involving Ultimate Holdings Ltd., a major GenesisIntermedia shareholder, and Native Nations Securities Inc. The company has obtained an agreement from El-Batrawi to cooperate with NASDAQ's inquiry.

According to a report filed with the SEC on Aug. 17, El-Batrawi borrowed $22.7 million from Ultimate Holdings in order to obtain 1,329,500 shares of stock in GenesisIntermedia.

In a Sept. 4 letter to shareholders, El-Batrawi said he was purchasing the shares - taking his personal holdings in the company to nearly 10.4 million shares - as a sign of belief in the company. El-Batrawi has expressed worry over the impact of short selling - borrowing stock to sell in the hopes that the share price will drop before the loan is called due - on GenesisIntermedia stock.

"We remain concerned about the short selling that is still occurring with respect to our common shares," El-Batrawi wrote. "Managing corporate growth becomes more challenging when people are betting against your success."

Native Nations, which develops financial tools for Native Americans, announced Oct. 15 that it has divested itself of Freeman Securities, a bond boutique company it acquired in January. Dow Jones reported that Native Nations made the decision after a Freeman employee made a loan of GenesisIntermedia stock that was improper. The loan was disclosed to the SEC.

When NASDAQ halted trading on GenesisIntermedia stock, the share value was $5.90. The stock rose from the mid-teens to $25 in a matter of days in late June - on June 29, the company received a conditional commitment for a $100 million line of credit from Riverdale LLC - then just as quickly dropped to the high-teens. It maintained that price level until early September, when the stock began a rapid decline in value. The day trading was halted, GenesisIntermedia stock had lost $2.89, a drop of 32.9 percent.

Centerlinq's touchscreen kiosks offer Internet and e-mail access, along with ticket and coupon printing, and are available in more than 30 malls nationally. In August, the company signed character actor John O'Hurley, who played catalog baron J. Peterman on the television program "Seinfeld," as Centerlinq's spokesman.