<PAGE>

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                                 UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549

                      ----------------------------------
                                   FORM 10-K
   FOR ANNUAL AND TRANSITION REPORTS PURSUANT TO SECTION 13 OR 15(d) OF THE
                        SECURITIES EXCHANGE ACT OF 1934

(Mark One)
[X] ANNUALREPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
          OF 1934

                    For Fiscal Year Ended December 31, 2001

[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
               EXCHANGE ACT OF 1934

                           Commission File 000-27271

                                 Be Free, Inc.
            (Exact name of registrant as specified in its charter)

                      Delaware                 04-3303188
                   (State or other
                    jurisdiction of              (I.R.S.
                   incorporation or      Employer Identification
                     organization)                No.)

                             154 Crane Meadow Road
                       Marlborough, Massachusetts 01752
                   (Address of principal executive offices)

                                (508) 480-4000
             (Registrant's telephone number, including area code)

       Securities to be registered pursuant to Section 12(b) of the Act:

                                     None

          Securities registered pursuant to Section 12(g) of the Act:

                         Common Stock, $0.01 par value
                               (Title of Class)

                      ----------------------------------


   Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.  Yes [X]  No [_]

   Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of the Form 10-K or any
amendment to this Form 10-K.  [X]

   The approximate aggregate market value of Common Stock held by
non-affiliates of the Registrant was $83,973,922 as of March 8, 2002.

   On March 8, 2002, the Registrant had 65,814,559 shares outstanding of voting
Common Stock, $0.01 par value.


--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

<PAGE>

                               TABLE OF CONTENTS
                            FORM 10-K ANNUAL REPORT
                      FISCAL YEAR ENDED DECEMBER 31, 2001

                                    PART I

<TABLE>
<CAPTION>
        Item                                                                Page
        ----                                                                ----
    <C> <S>                                                                 <C>
    1.  Business...........................................................   1
    2.  Properties.........................................................   8
    3.  Legal Proceedings..................................................   8
    4.  Submission of Matters to a Vote of Security Holders................   8

                                      PART II

    5.  Market for Registrant's Common Equity and Related Stockholder
        Matters............................................................   9
    6.  Selected Consolidated Financial Data...............................  10
    7.  Management's Discussion and Analysis of Financial Condition and
        Results of Operations..............................................  11
    7A. Quantitative and Qualitative Disclosures About Market Risk.........  28
    8.  Financial Statements and Supplementary Data........................  28
    9.  Changes in and Disagreements with Accountants on Accounting and
        Financial Disclosure...............................................  28

                                     PART III

    10. Directors and Executive Officers of the Registrant.................  29
    11. Executive Compensation.............................................  31
    12. Security Ownership of Certain Beneficial Owners and Management.....  38
    13. Certain Relationships and Related Transactions.....................  39

                                      PART IV

    14. Exhibits, Financial Statement Schedules and Reports on Form 8-K....  40
</TABLE>



    This Annual Report on Form 10-K contains forward-looking statements within
the meaning of Section 21E of the Securities Exchange Act of 1934, as amended,
and Section 27A of the Securities Act of 1933, as amended. For this purpose,
any statements contained herein that are not statements of historical fact may
be deemed to be forward-looking statements. Without limiting the foregoing, the
words "believes," "anticipates," "plans," "expects" and similar expressions are
intended to identify forward-looking statements. The important factors
discussed under the caption "Factors That May Affect Future Results" in Item 7
of Part II, among others, could cause actual results to differ materially from
those indicated by forward-looking statements made herein and presented
elsewhere by management. Such forward-looking statements represent management's
current expectations and are inherently uncertain. Investors are warned that
actual results may differ from management's expectations.


<PAGE>

                                    PART I

ITEM 1.  BUSINESS

    We provide a marketing platform that allows online businesses to attract,
convert and retain customers easily and cost effectively. Our marketing
platform includes technology and services to manage, track and analyze a
variety of online marketing programs. It is offered on a hosted basis to enable
businesses to execute marketing programs without the expense of building and
maintaining their own in-house technical infrastructure and resources. We offer
two types of services on this platform, partner marketing services and site
personalization services.

    With our BFAST(R) partner marketing services, online businesses can track
and manage various types of marketing programs that they have established with
their online marketing partners. These partner marketing programs may include
affiliate programs, member buying and shopping portal programs, content
distribution programs, sponsorship programs and strategic partnerships. Using
BFAST, our customers can measure the results of these marketing programs in a
uniform manner, allowing program-by-program comparisons. Our customers can pay
their marketing partners in a variety of ways, including performance-based
compensation. Our commerce customers, those that sell goods or services online,
typically pay their marketing partners based on the sales or sales leads that
those marketing partners generate, as tracked by BFAST. Our content customers,
those that provide information online, typically pay their marketing partners
based on the traffic sent to their sites by their marketing partners, as
tracked by BFAST. As a result, these services provide our customers with a
cost-effective solution for establishing, managing and rewarding their
marketing partners.

    In addition to our partner marketing services, we offer BSELECT/SM/ Onsite
which allows our customers to convert more visitors to their Internet site into
customers by recommending relevant products or content in real-time. We are
typically paid for our BSELECT Onsite site personalization services based upon
the number of personalized product and content promotions that are clicked by
each Internet site visitor. Revenue from BSELECT Onsite has been less than five
percent of total revenue in each period.

Recent Developments

    On March 10, 2002, we entered into a merger agreement with ValueClick, Inc.
Pursuant to the merger agreement, we will be merged with, and become a
wholly-owned subsidiary of ValueClick. Upon consummation of the merger, each
outstanding share of our Common Stock will be converted into the right to
receive 0.65882 shares of common stock of ValueClick. In the aggregate,
ValueClick will issue approximately 43.4 million shares of its common stock in
respect of all of our outstanding securities. Upon consummation of the merger,
our stockholders will own approximately 45% of the combined company's
outstanding shares. The consummation of the merger is subject to customary
closing conditions, including the approval of our stockholders and the
stockholders of ValueClick and the receipt of certain governmental approvals.

Be Free's Marketing Platform

    Be Free offers a marketing platform with hosted, easy-to-integrate
services. Hosted services allow our customers to develop and deploy their
online marketing programs more rapidly. Hosted services also dramatically
reduce our customers' capital expenditures, systems maintenance costs, and
human resources required to support alternative solutions.

                                      1

<PAGE>

    Be Free's marketing platform delivers the technological elements to enable
our customers to build effective online partner marketing and site
personalization programs including delivering, tracking, analyzing and
personalizing online promotions, and compensating and communicating with online
marketing partners.

Delivering Promotions

    We provide our customers with technology to manage and deliver promotions
to their sites and to their marketing partners' sites. We support the delivery
of a wide variety of promotion types, from plain text to rich media. Promotions
are delivered in real-time and can be personalized based on a site visitor's
anonymous profile, or selectively served to certain marketing partners.

Tracking Promotions

    We track when promotions are delivered, when site visitors click on the
promotions that they see, and when they make a purchase as a result of those
promotions. We tracked the delivery of nearly 12 billion promotions in the
fourth quarter of 2001 and over 60 billion in 2001.

Analyzing Promotions

    We provide our customers with sophisticated methods for analyzing the
results of their various online marketing programs, the performance of the
marketing partners within those programs and the performance of promotions
delivered through each partner. We also provide our customers' marketing
partners with the analytics that they need to evaluate and improve their
effectiveness.

Personalizing Promotions

    Our personalization technology allows our customers to formulate
appropriate recommendations in real-time--without having to know an Internet
site visitor's identity. This patented technology predicts which products or
content a visitor to our customers' Internet sites may find of interest based
on the visitor's anonymous browsing and buying behavior. Our personalization
technology uses a proprietary algorithm called Adaptive Relationship Modeling,
or ARM, to identify emerging trends in customer behavior and to adjust
promotions delivered to each subsequent site visitor.

Compensating Marketing Partners

    Our marketing platform includes compensation capabilities that give our
customers flexibility in compensating their marketing partners. Our customers
use these flexible compensation rules to motivate desired behavior among their
marketing partners.

Communicating with Marketing Partners

    We provide our customers with the ability to communicate globally to all of
their online marketing partners, or to address individual partners in a
customized manner. The communication can be accomplished through e-mail or a
secure Internet site that we maintain for our customers.

                                      2

<PAGE>

BFAST Partner Marketing Service

    Our BFAST partner marketing service allows our customers to manage and
track a wide range of online marketing programs that they have established with
their online marketing partners, including:

Affiliate Programs

    BFAST allows our customers to recruit, track and manage thousands of small,
mid-sized and large marketing partners. Those marketing partners place specific
customer promotions in context on their Internet sites. Be Free is the only
hosted provider of affiliate marketing services that specializes in building
customer-branded affiliate marketing programs. As a result of these
customer-branded programs, our customers get the benefits of having their own
affiliate programs, but avoid many of the associated costs of maintaining a
program built internally. Other affiliate marketing companies provide their
customers with a shared network of marketing partners. Customers with a
"shared" network for affiliate marketing must share their marketing partners
with all of the other online merchants of that shared program, even those other
merchants that may be competitors.

Member Buying and Shopping Portal Programs

    Member buying sites and shopping portals may be marketing partners for our
customers. Member buying sites give their site visitors incentives in the form
of airline miles, shopping points or cash in exchange for shopping on our
customers' sites. Shopping portals provide their site visitors with product and
service information and then direct those visitors to Internet sites where they
can purchase the products and services, including our customers' Internet
sites. Our BFAST partner marketing services include special reporting
functionality and marketing partner recruitment and support services that allow
our customers to establish and extend member buying and shopping portal
marketing programs easily and cost effectively.

Content Distribution Programs

    BFAST allows our content customers to distribute their content, or
information, on their marketing partners' Internet sites. Our content customers
can use these distribution programs to deliver headlines and summary
information that direct users to their own site for additional information. To
create an additional advertising mechanism, our customers can also use these
programs to distribute more detailed information bundled with advertising.

Sponsorship Programs

    Our customers may use BFAST to track and analyze their sponsorship of the
highest trafficked Internet sites. Sponsorships are typically premium marketing
programs that require careful analysis and management to achieve maximum return
on investment.

    In general, we enter into a standard service agreement that requires our
BFAST partner marketing service customers to pay us a one-time integration fee
and monthly performance fees, subject to monthly or quarterly minimum amounts.
For our commerce customers, the performance fees are generally based on either
a percentage of the sales generated or the number of sales leads or sales
orders placed. For our content customers, the performance fees are generally
based on the volume of

                                      3

<PAGE>

clicks generated from their marketing partners' sites. We currently derive most
of our revenue from BFAST partner marketing services.

BSELECT Onsite Site Personalization Service

    BSELECT Onsite is a sophisticated recommendation tool that enables our
customers to use their Internet site visitors' anonymous online behavior to
recommend the products, content and services that are likely to be of most
interest to each visitor. BSELECT Onsite then measures the effectiveness of
each of those personalized recommendations.

    For our commerce customers, BSELECT Onsite delivers personalized product or
service recommendations directly on the pages of their online stores. These
recommendations can help to increase the number of site visitors that purchase,
as well as their average purchase price. For our content customers, BSELECT
Onsite can help to increase the number of pages viewed, and the overall site
viewing time, by delivering relevant content to each site visitor--creating
additional advertising opportunities for our content customers.

    In general, we enter into a standard service agreement that requires our
BSELECT Onsite customers to pay us a one-time initialization and monthly
performance fees, subject to minimum amounts. The performance fees are
generally based the number of times an Internet site visitor clicks on a
recommendation made by BSELECT Onsite.

Customer Services

    We provide a wide-range of customer services with our partner marketing and
site marketing offerings including comprehensive integration, training, support
and consulting services. We provide our customers with individualized customer
services designed to increase the performance of their online marketing
programs and their overall satisfaction with our services. We assign
knowledgeable customer service managers to our customers for proactive and
reactive support.

    As part of our basic customer services, we provide integration services to
new customers. We work with new customers to create reliable, automated data
transfers between their databases and our databases. We teach our customers to
use our technology effectively and efficiently. We provide business training to
customers, which helps them better understand the business decisions that they
face in launching their online marketing programs. We also offer regular
refresher and training updates.

    Our program consulting managers support our customers in managing their
marketing programs, developing and interpreting program analyses, and testing
new promotional methods. These customer service managers also convey emerging
customer strategies, communicate customer feature requests, manage data
requests and provide ongoing project management services for special customer
initiatives.

    Our best practices consulting team gathers and analyzes data from industry
sources, our database and our customers' initiatives to provide our customers
with industry-wide performance results against which they can measure their own
success. This team formulates strategies for how our customers might more
effectively promote their products or services. We present our best practices
solutions through seminars, customer bulletins, case studies and one-on-one
dialogues with customers.

                                      4

<PAGE>

Enhanced Customer Services

    We provide optional, enhanced customer services to promote further success
of our customers' partner marketing programs for additional fees. In general,
our customers pay us for these optional, enhanced customer services based upon
flat fees or the volume of related activity. These services include:

Outsourced Program Management

    Our customers may take advantage of an Outsourced Program Management
service. With these services, we completely manage our customers online
marketing programs. Our Outsourced Program Management services include
marketing program planning, marketing partner management, marketing partner
support, and marketing program administration.

Marketing Partner Support

    We also provide our customers with Marketing Partner Support services,
which include technical and business support for their marketing partners.
Support is customer-branded and delivered through e-mail and through an online
database that automatically responds to plain text questions.

Marketing Partner Development

    Marketing Partner Development is a proactive consulting service designed to
maximize the performance of our customers' marketing partners. These services
provide a select group of high-performing marketing partners with customized
analysis and advice to enhance their results.

Marketing Partner Application Review

    We offer our customers a Marketing Partner Application Review service that
facilitates the acceptance of prospective marketing partners into our
customers' affiliate marketing programs in accordance with our customers'
guidelines.

Marketing Partner Commission Payment

    We provide a Marketing Partner Payment service that provides for our
printing and mailing of commission checks to our customers' marketing partners.

Sales and Marketing

    We have a direct sales force that targets leading businesses with online
marketing channels. The direct sales force is assigned to different
geographical regions and is supported by sales engineers. We maintain direct
sales personnel in eight major metropolitan areas throughout the United States,
as well as in London, England and Munich, Germany. We also have a telesales
group, located in our Marlborough, Massachusetts headquarters, that targets
small and mid-sized businesses with online marketing channels.

    In order to achieve broader distribution of our services, we have
contracted with third parties to promote our services to their customers. These
third parties typically receive a percentage of our revenue derived from the
customers that they bring to us.

                                      5

<PAGE>

    We target potential customers through online and offline advertising,
telemarketing, public relations, our Internet sites, conferences, trade shows
and customer referrals. We have primarily focused our marketing efforts in the
United States and Europe.

Systems Infrastructure

    The system architecture for our hosted services is designed to support
large-scale programs. Our systems are developed entirely for use over the
Internet. Our customers are able to access marketing, sales and merchandising
data from our Oracle-based databases using their desktop computers and their
standard Internet connection. Our reporting systems use standard Internet
protocols.

    Our systems currently reside in two data centers; one in Sterling, Virginia
and one in Pittsburgh, Pennsylvania. Each data center has been designed with a
layered architecture to yield significant benefits to our customers in
performance, scalability, availability and reliability. Our software and
databases run on multiple high-speed servers that are connected by
high-capacity connections and are organized into multiple tiers. Each tier
functions to address specific data storage and data traffic considerations to
enhance reporting and real-time transactional performance. Each tier is
composed of multiple connected servers performing similar tasks, each of which
has its own power supply. If a server fails, that server's tasks are
automatically reassigned to another running computer. In addition, identical
data is also stored in various locations. The redundant design enhances the
ability of the system to tolerate the failure of an individual server or
failures in system storage without the loss of data or the ability of the
computers to give our customers real-time operating capability.

    We believe the multi-data center and multi-tier server design better
enables us to provide our customers with highly available and reliable
uninterrupted service. Each data center has real-time transactional capacity.

    The connections from the network data centers into the multi-tiered servers
are also designed to provide customers with reliable, uninterrupted service. We
regularly test and maintain the multiple connections between our servers, and
regularly test the connections between the network data centers and the
Internet. Our engineering and hosting center personnel monitor traffic patterns
and congestion points and reroute traffic flows in an effort to reduce end-user
response times. We provide monitoring and support services designed to maintain
transaction availability 24 hours a day, 365 days a year.

    Although our systems are designed to enhance reliability, system and
communication failures have caused both delays and cessation of services. We
have taken additional steps designed to decrease the likelihood of future
outages. These steps include installing additional server and storage hardware,
and adding an additional level of redundancy to all tiers of our system
architecture. Our development team has modified our software to make it more
functional upon hardware failure. Even with these improvements, there can be no
assurance that our services will not be interrupted in the future.

    Our systems infrastructure uses platform systems with UNIX and Windows NT.
We currently use Sun Microsystems and Intel-based servers and EMC storage
equipment. While we are not dependent on any single server hardware system or
vendor, any change could be costly and time consuming.

                                      6

<PAGE>

Competition

    The markets for online marketing platform services are new, rapidly
evolving and highly competitive. We do not currently compete against
established companies across the full range of services that we provide. We do,
however, compete against larger companies with respect to some of the services
we provide, and we compete more broadly against similar sized, private and
public companies. We expect to face future competition from larger companies as
they expand their services to compete across a broader range of our services,
and as we expand our own services to compete with theirs.

    Our most direct competition currently comes from providers of affiliate
marketing and site personalization solutions.

    For the provision of affiliate marketing solutions, we compete with
internally-developed affiliate marketing solutions and multi-merchant, "shared"
affiliate marketing program providers, including Commission Junction,
Linkshare, Performix and Trade Doubler--all privately held companies.

    For the provision of site personalization solutions, we compete with
companies such as Net Perceptions. Net Perceptions, a public company, provides
an enterprise software solution.

    More broadly, a portion of our tracking and analyzing services may be
considered similar to features found in services provided by electronic
customer relationship management solutions, such as E.piphany and Accrue, both
public companies. In addition, banner advertising services, such as those
provided by DoubleClick, a public company, may be considered alternative online
marketing programs to those that we enable.

    We believe that the principal competitive factors in our market are:

    .   the provision of comprehensive, reliable services;

    .   the ability to offer a customer ownership of and control over a
        significant sales channel;

    .   the provision of extensive online reports and analyses; and

    .   price.

    We seek to compete against internally developed affiliate marketing
solutions by providing more comprehensive, cost-effective services that are
more easily managed. We seek to compete against multi-merchant, "shared"
affiliate program providers on the basis of our technology, by permitting our
customers greater control over their affiliate sales channel and providing
individualized customer service.

    We seek to compete against other site personalization solutions on the
basis of our technology and our combined service offering.

    We seek to compete against banner advertising companies by offering broader
services and the ability to track promotional efforts through to resulting
sales rather than merely to the number of times a promotion is viewed.

                                      7

<PAGE>

Employees

    As of December 31, 2001, we had a total of 165 employees, 47 of whom were
in sales and marketing, 46 in client services, 50 in development and
engineering and 22 in finance and administration. Sales and marketing employees
include salespeople, sales administration personnel, product marketing and
marketing communications personnel. From time to time we also employ
independent contractors to supplement our development staff. Our employees are
not represented by a labor union and we have never experienced a work stoppage.
We believe our relations with our employees are good.

ITEM 2.  PROPERTIES

    Our headquarters are located in Marlborough, Massachusetts, where we occupy
approximately 35,700 square feet under a lease that expires in October 2004.
Our development and engineering group is located in Pittsburgh, Pennsylvania,
where we lease approximately 24,000 square feet of office space under leases
that expire in April 2005. Our European headquarters are located in Windsor,
England, where we lease approximately 11,000 square feet of office space under
a lease that expires in November 2008. In addition, we lease space in three
cities for sales, marketing and services. We believe that our existing
facilities are adequate for our current needs and that suitable additional
space will be available as needed.

ITEM 3.  LEGAL PROCEEDINGS

    Be Free is subject to legal proceedings and claims that arise in the
ordinary course of business. Be Free does not believe that the outcome of any
of those matters will have a material adverse effect on Be Free's consolidated
financial position, operating results or cash flows.

    On November 30, 2001, a class action lawsuit was filed in the Southern
District of New York naming as defendants the Company, the managing
underwriters of the Company's initial public offering (the "IPO"), and the
following officers and former officers of the Company: Gordon B. Hoffstein,
Samuel P. Gerace, Jr., Thomas A. Gerace and Stephen M. Joseph. The complaint is
captioned Saul Kassin v. Be Free, Inc., et al., 01-CV-10827. The complaint
alleges, in part, that the Company's IPO registration statement and final
prospectus contained material misrepresentations and/or omissions related, in
part, to excessive and undisclosed commissions allegedly received by the
underwriters from investors to whom the underwriters allegedly allocated shares
of the IPO. The Company has not yet formally responded to the allegations. The
Company believes that the claims against the Company and the individual
directors and officers named in the lawsuit are without merit and intends to
defend such claims vigorously. As this case is at an early stage, it is not
possible to express an opinion as to its final outcome or estimate the amount
of a probable loss, if any, that might result.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

    No matters were submitted to a vote of our stockholders in the fourth
quarter of 2001.

                                      8

<PAGE>

                                    PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

    Be Free effected its initial public offering of its Common Stock on
November 3, 1999 at a price of $6.00 per share as adjusted for the stock split
described below. As of February 28, 2002, there were approximately 451 holders
of record of Be Free Common Stock. Be Free Common Stock is listed for quotation
on the Nasdaq National Market under the symbol "BFRE". The following table sets
forth the high and low sales prices for our Common Stock as reported by the
Nasdaq National Market for the years 2000 and 2001. All share amounts for all
periods presented have been restated to reflect the Common Stock split on March
8, 2000 effected as a 100% stock dividend.

<TABLE>
<CAPTION>
                                                Price Range of
                                                 Common Stock
                                                --------------
                                                 High    Low
                                                ------  ------
                  <S>                           <C>     <C>
                  Year Ended December 31, 2000:
                  Quarter ender March 31....... $60.88  $22.00
                  Quarter ended June 30........  22.00    6.63
                  Quarter ended September 30...  10.00    3.38
                  Quarter ended December 31....   5.31    1.63
                  Year Ended December 31, 2001:
                  Quarter ender March 31....... $ 3.38  $ 0.75
                  Quarter ended June 30........   1.80    0.94
                  Quarter ended September 30...   1.88    1.02
                  Quarter ended December 31....   2.28    1.26
</TABLE>

    We currently intend to retain future earnings, if any, to finance our
growth. We have not paid any cash dividends since January 1, 1996 and do not
anticipate paying cash dividends on our Common Stock in the foreseeable future.
Payment of future dividends, if any, will be at the discretion of our board of
directors after taking into account various factors, including our financial
condition, operating results, current and anticipated cash needs, restrictions
in financing agreements and plans for expansion.

                                      9

<PAGE>

ITEM 6.  SELECTED CONSOLIDATED FINANCIAL DATA

    The following table sets forth selected consolidated financial data for the
five years in the period ended December 31, 2001. This data should be read in
conjunction with "Management's Discussion and Analysis of Financial Condition
and Results of Operations" and our consolidated financial statements and
related notes. The historical results presented herein are not necessarily
indicative of future results.

<TABLE>
<CAPTION>
                                                                                    Year Ended December 31,
                                                                        -----------------------------------------------
                                                                          2001        2000       1999      1998      1997
                                                                        ---------   --------   --------   -------   -------
<S>                                                                     <C>         <C>        <C>        <C>       <C>
Statement of Operations Data:                                                (In thousands, except per share data)
Revenue................................................................ $  23,414   $ 19,685   $  5,329   $ 1,327   $   276
Operating expenses:
  Network costs........................................................     5,297      3,627        845       424       273
  Sales and marketing (exclusive of equity related compensation of
   $751, $588, $525, $56 and $0, respectively).........................    15,515     17,873      9,329     1,154       180
  Client services (exclusive of equity related compensation of
   $130, $156, $238, $14 and $0, respectively).........................     6,589      6,918      3,474       300        --
  Development and engineering (exclusive of equity related
   compensation of $283, $197, $146, $1,865 and $0, respectively)......    10,466     10,540      4,767       729       426
  General and administrative (exclusive of equity related compensation
   of $1,122, $718, $1,033, $450 and $0, respectively).................     8,567      6,374      2,824       875       332
  Equity related compensation..........................................     2,286      1,659      1,942     2,385        --
  Restructuring charges................................................     5,050         --         --        --        --
  Intangible amortization, merger related expenses and charge for
   the impairment of assets............................................   118,393     46,482         --        --        --
                                                                        ---------   --------   --------   -------   -------
  Total operating expenses.............................................   172,163     93,473     23,181     5,867     1,211
                                                                        ---------   --------   --------   -------   -------
Operating loss.........................................................  (148,749)   (73,788)   (17,852)   (4,540)     (935)
Interest income (expense), net.........................................     6,734      8,876        348      (224)      (99)
                                                                        ---------   --------   --------   -------   -------
Net loss before extraordinary item.....................................  (142,015)   (64,912)   (17,504)   (4,764)   (1,034)
Extraordinary item--loss on early extinguishment of debt...............        --         --       (330)       --        --
                                                                        ---------   --------   --------   -------   -------
Net loss...............................................................  (142,015)   (64,912)   (17,834)   (4,764)   (1,034)
Accretion of preferred stock to redemption value.......................        --         --     (1,517)     (130)       --
                                                                        ---------   --------   --------   -------   -------
Net loss attributable to common stockholders........................... $(142,015)  $(64,912)  $(19,351)  $(4,894)  $(1,034)
                                                                        =========   ========   ========   =======   =======
Basic and diluted net loss per share (1)............................... $   (2.22)  $  (1.07)  $  (1.02)  $ (0.31)  $ (0.04)
Shares used in computing basic and diluted net loss per share (1)......    64,086     60,759     18,951    16,018    27,139
                                                                                       As of December 31,
                                                                        -----------------------------------------------
                                                                          2001        2000       1999      1998      1997
                                                                        ---------   --------   --------   -------   -------
Balance Sheet Data:                                                                      (In thousands)
Cash, cash equivalents and marketable securities....................... $ 133,146   $153,881   $ 79,692   $ 4,327   $    76
Working capital (deficit)..............................................   131,405    147,941     68,579     3,422      (502)
Total assets...........................................................   156,096    300,375     90,837     5,971       254
Long-term debt, net of current portion.................................       604      2,781      2,507     4,949       333
Convertible preferred stock............................................        --         --         --     8,786        --
Total stockholders' equity (deficit)...................................   145,969    286,957     82,561    (9,496)   (1,897)
</TABLE>
--------
(1) All share and per share amounts for all periods presented have been
    restated to reflect the Common Stock split on March 8, 2000, effected as a
    100% stock dividend.

                                      10

<PAGE>

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
                     OF OPERATIONS

    The following discussion should be read in conjunction with the
consolidated financial statements provided under Part II, Item 8 of this Annual
Report on Form 10-K. Certain statements contained herein may constitute
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. These statements involve a number of risks,
uncertainties and other factors that could cause actual results to differ
materially, as discussed more fully herein.

    The forward-looking information set forth in this Annual Report on Form
10-K is as of March 22, 2002, and we undertake no duty to update this
information. Should events occur subsequent to March 22, 2002 that make it
necessary to update the forward-looking information contained in this Form
10-K, the updated forward-looking information will be filed with the SEC in a
Quarterly Report on Form 10-Q or as an earnings release included as an exhibit
to a Form 8-K, each of which will be available at the SEC's website at
www.sec.gov. More information about potential factors that could affect our
business and financial results is included in the section entitled "Factors
That May Affect Future Results" beginning on page 22 of this Form 10-K.

Overview

    We provide a marketing platform that enables our customers to attract,
convert and retain online customers easily and cost effectively. Our marketing
platform delivers technology and services including delivering, tracking,
analyzing and personalizing online promotions, and compensating and
communicating with online marketing partners. Our hosted solution is designed
to increase our customers' online sales or traffic and to decrease their cost
of customer acquisition.

    We were originally incorporated in January 1996. Initially, we provided
customized software development and support services for automating marketing
programs. We later changed our focus to online marketing services.

    To date, we have generated our revenue primarily from our BFAST partner
marketing services. In general, we enter into a standard service agreement that
requires our BFAST customers to pay us a one-time integration fee and monthly
or quarterly service fees. For our commerce customers, the service fees are
generally based on either a percentage of the sales generated or on the number
of transactions or orders generated by their marketing partners, subject to
minimum levels. For our content customers, the service fees are generally based
on the volume of click-throughs generated by their marketing partners, subject
to minimum levels. In addition to the BFAST service, we also offer optional,
enhanced customer services, such as outsourced program management, marketing
partner support and development, marketing partner application review and
marketing partner commission payment services for additional fees.

    In the third quarter of 2000, we introduced our site personalization
service, BSELECT Onsite. In general, we enter into a standard service agreement
that requires our BSELECT Onsite customers to pay us a one-time initialization
fee and monthly or quarterly service fees. The BSELECT Onsite service fees are
generally based on the volume of click-throughs generated by personalized
promotions served to our customers' Internet sites, subject to minimum levels.

                                      11

<PAGE>

    We have incurred significant net losses and negative cash flows from
operations since the commencement of our online marketing business, and as of
December 31, 2001 we had an accumulated deficit of approximately $231.9
million. We had net losses of approximately $142.0 million, $64.9 million and
$17.8 million for the years ended December 31, 2001, 2000 and 1999,
respectively. These losses have been funded primarily through the private
issuance of preferred stock, public offerings of our Common Stock and
borrowings. We raised net proceeds of $70.6 million and $104.7 million during
our public offerings in November 1999 and in March 2000, respectively.

    On February 29, 2000, we acquired TriVida Corporation in exchange for
2,912,996 shares of our Common Stock, net of an escrow claim of 20,280 shares.
In addition, we assumed options to purchase 566,592 shares of our Common Stock
in this merger. The purchase price of $164.7 million was allocated to $0.3
million of net liabilities and $165.1 million of intangible assets, including
goodwill. We also incurred additional expenses totaling approximately $0.6
million in 2000 primarily relating to employee severance and other
restructuring charges in connection with the integration of TriVida. (See
discussion below relating to intangible amortization, merger related expenses
and charge for impairment of assets.)

    On March 10, 2002, we entered into a merger agreement with ValueClick, Inc.
Pursuant to the merger agreement, we will be merged with, and become a
wholly-owned subsidiary of ValueClick. Upon consummation of the merger, each
outstanding share of our Common Stock will be converted into the right to
receive 0.65882 shares of common stock of ValueClick. In the aggregate,
ValueClick will issue approximately 43.4 million shares of its common stock in
exchange for our outstanding securities. Upon consummation of the merger, our
stockholders will own approximately 45% of the combined company's outstanding
shares. The consummation of the merger is subject to customary closing
conditions, including the approval of our stockholders and the stockholders of
ValueClick and the receipt of certain governmental approvals.

Critical Accounting Policies And Estimates

    Our discussion and analysis of our financial condition and results of
operations are based upon our consolidated financial statements, which have
been prepared in accordance with accounting principles generally accepted in
the United States. The preparation of these financial statements requires us to
make estimates and judgments that affect the reported amounts of assets,
liabilities, revenues and expenses, and related disclosure of contingent assets
and liabilities. On an on-going basis, we evaluate our estimates and judgments,
including those related to revenue recognition, allowance for doubtful
accounts, investments, intangible assets, restructuring, long-term service
contracts, contingencies and litigation. We base our estimates on historical
experience and on various other assumptions that are believed to be reasonable
under the circumstances, the results of which form the basis for making
judgments about the carrying values of assets and liabilities that are not
readily apparent from other sources. Actual results may differ from these
estimates under different assumptions and/or conditions.

                                      12

<PAGE>

    We believe the following accounting policies are critical to our results of
operations and include our more significant judgments and estimates used in the
preparation of the consolidated financial statements:

    .   revenue recognition;

    .   estimating the allowance for doubtful accounts; and

    .   valuation of long-lived and intangible assets.

Revenue recognition

    We derive our revenue from providing online marketing services to
customers. Customer contracts generally provide for a one-time integration or
initialization fee and monthly or quarterly service fees. For our commerce
customers, the service fees are generally based on either a percentage of the
sales generated or on the number of transactions or orders generated by their
marketing partners, subject to minimum levels. For our content customers, the
service fees are generally based on the volume of click-throughs generated by
their marketing partners, subject to minimum levels. We also offer optional,
enhanced customer services, such as outsourced program management, marketing
partner support and development, marketing partner application review and
marketing partner commission payment services for additional fees.

    We recognize revenue consistent with SEC Staff Accounting Bulletin No. 101,
"Revenue Recognition in Financial Statements" (SAB No. 101). Under SAB No. 101,
we recognize revenue when a contract has been signed, services have been
rendered, the related fee is fixed and determinable and collection of the fee
is reasonably assured. We recognize integration and initialization fees ratably
over the expected life of the customer relationship. Service revenue is
recognized in the period earned based on the minimum level specified in the
contract or, when the transaction volume exceeds the minimum level for that
period, based on transaction volume. Revenue for enhanced customer services is
recognized when delivered based upon the related underlying activity.

    Revenue is deferred when collection is not reasonably assured. On an
on-going basis, we perform detailed analyses and monitor individual customer
accounts to evaluate collectibility. When we identify a customer with a
collection risk, we defer the related revenue until collection is reasonably
assured.

Allowance for doubtful accounts

    Our accounts receivable are reduced by an allowance for amounts for which
collectibility is doubtful. Management specifically analyzes accounts
receivable and analyzes historical bad debts, customer concentrations, customer
credit-worthiness, current economic trends and changes in our customer payment
terms when evaluating the adequacy of the allowance for doubtful accounts. Our
accounts receivable balance was $2.7 million, net of allowance for doubtful
accounts of $0.8 million as of December 31, 2001. The estimates that we use to
calculate the allowance for doubtful accounts may not properly reflect bad debt
exposure.

Valuation of long-lived and intangible assets

    Intangibles and other long-lived assets are amortized over their estimated
useful lives. In accordance with SFAS No. 121, "Accounting for the Impairment
of Long-Lived Assets to Be Disposed Of," we periodically review long-lived
assets, including intangible assets resulting from acquisitions, for impairment
whenever events or changes in circumstances indicate that the carrying amount
of these

                                      13

<PAGE>

assets may exceed their fair value. We consider several factors in determining
whether an impairment may have occurred, including the intended use of the
underlying asset, our market capitalization compared to our book value per
share, the overall business climate and current estimates for expected
operating results of acquired businesses.

    Based on our analyses in 2001, we decided that the technology obtained
through the acquisition of TriVida would no longer be integrated into the BFAST
technology as originally intended due to the deterioration of the Internet
retail market and customer feedback as well as other business factors
considered. As a result of these analyses, we recorded an impairment charge
during the first quarter of 2001, totaling $102.7 million, which represented
the excess of the carrying amount of the TriVida assets over the estimated
discounted cash flows. Our intangible asset balance was $3.0 million, net of
accumulated amortization of $61.5 million as of December 31, 2001. The
remaining carrying amount of the assets will be amortized over their remaining
useful lives.

    In future periods, our evaluations may result in all or a portion of the
intangible and other long-lived assets being written-off.

Results of Operations

Revenue

    Through December 31, 2001, revenue included BFAST integration and BSELECT
Onsite initialization, monthly service and enhanced optional customer service
fees.

    Revenue increased 19% to $23.4 million in 2001 from $19.7 million in 2000.
The increase is attributable to a shift in our customer base from primarily
smaller Internet retail businesses to larger brick and mortar companies doing
business online. As compared to our previous customer base, these companies
generally have larger online programs, utilize more of our services and,
consequently, generate greater revenues. Although our customer base decreased
by 30%, to 249 customers at the end of 2001 from 358 at the end of the prior
year, the average annual revenue per customer increased 71%, to $94,032 per
customer in 2001 from $54,986 in 2000. In addition, we recorded $0.5 million of
incremental revenue as a result of our implementing a new automated billing
system during the fourth quarter of 2001 that allows us to recognize all
revenue in the quarter that it was earned. Previously, we recognized
transaction-based revenue above minimum levels one month in arrears. Thus, in
the fourth quarter of 2001, we recognized one additional month of
transaction-based revenue as revenue in the fourth quarter of 2001.

    Revenue increased 269% to $19.7 million in 2000 from $5.3 million in 1999.
The increase was attributable to the addition of 194 customers, greater revenue
from existing customers as a result of more customers exceeding minimum levels,
increases in the minimum BFAST service level, and new enhanced customer service
offerings.

    On an on-going basis, we perform detailed analyses and monitor individual
customer accounts to evaluate collectibility. When we identify a customer with
a collection risk, we defer the related revenue until the collection of cash.
We did not incur any significant accounts receivable write-offs during 2001,
2000 or 1999.

                                      14

<PAGE>

Network Costs

    To better define our component costs, we renamed the Cost of revenue line
item in the consolidated statements of operations to Network costs during the
first quarter of 2001. Network costs consist of expenses related to the
operation of our hosting services. These expenses primarily include
depreciation and operating lease expense for systems and storage equipment,
costs for third-party data center facilities and costs for Internet
connectivity to our customers and their marketing partners.

    Network costs increased 46% to $5.3 million in 2001 from $3.6 million in
2000. This increase is attributable to higher depreciation, equipment lease and
data center facilities expenses associated with the addition of systems and
data storage equipment at our Jersey City, New Jersey data center and the
addition of a second data center in Sterling, Virginia in the fourth quarter of
2000. These investments were made to enable us to increase capacity and
redundancy and to accommodate anticipated growth in the activity level of our
customers. As part of our restructuring plans, we consolidated data centers in
2001 and currently have data centers in only two locations; Sterling, Virginia
and Pittsburgh, Pennsylvania.

    Network costs increased 329% to $3.6 million in 2000 from $0.8 million in
1999. This increase was due to higher depreciation, equipment lease and data
center facilities expenses associated with the addition of data centers in
London, England and El Segundo, California, and additional servers and data
storage equipment in order to meet the growth in our customer base.

Sales and Marketing Expenses

    Sales and marketing expenses consist principally of payroll and related
costs for our sales, marketing and business development groups. Also included
are the costs for marketing programs to promote our services to our current and
prospective customers, as well as programs to recruit marketing partners for
our current customers.

    Sales and marketing expenses decreased 13% to $15.5 million in 2001 from
$17.9 million in 2000. The decrease is primarily attributable to a reduction of
49 employees in the sales and marketing areas resulting in cost savings of $1.4
million. Further cost savings of $1.0 million are attributable to reduced
spending for advertising, marketing partner recruitment, direct mail, trade
shows, public relations and market research.

    Sales and marketing expenses increased 92% to $17.9 million in 2000 from
$9.3 million in 1999. The increase was primarily attributable to the addition
of 29 direct sales and telesales employees and related expenses of
approximately $6.1 million. Further contributing to the increase were costs of
$0.8 million related to a recruitment program to assist customers in attracting
marketing partners, incremental general marketing spending of $0.4 million and
additional spending in marketing research of $0.3 million.

Client Services Expenses

    Client services expenses primarily relate to the cost of assisting our
customers in managing their relationships with marketing partners, as well as
providing BFAST integration and BSELECT Onsite initialization, training and
technical support to our customers. These services are designed to increase the
success of our customers' performance marketing sales channels and their
overall satisfaction with

                                      15

<PAGE>

our services by providing best practices techniques, marketing partner sales
channel analysis, training and technical assistance. We also provide similar
services to our customers' marketing partners on an optional basis for
additional fees.

    Client services expenses decreased 5% to $6.6 million in 2001 from $6.9
million in 2000. The decrease is attributable to a reduction of 25 employees
resulting in a cost savings of $0.9 million, which was partially offset by an
increase of $0.5 million in costs related to our Outsourced Program Management
service which includes marketing program planning, support and management for
our customers.

    Client services expense increased 99% to $6.9 million in 2000 from $3.5
million in 1999. The increase was the result of adding 23 employees to the
client services group to support the growth in the customer base and to provide
additional services to our customers.

Development and Engineering Expenses

    Development and engineering expenses primarily include payroll and related
costs for our product development and engineering groups and depreciation
related to equipment used for development purposes. The product development
group designs and develops the underlying technologies for our services and the
engineering group develops and manages the infrastructure necessary to support
our services.

    Development and engineering expenses totaled $10.5 million in each of 2001
and 2000. These expenses decreased in 2001 by $1.3 million relating to the
reduction of 36 employees. This decrease was offset by an increase in
non-capitalizable software development costs of $0.9 million and an increase
hardware and software maintenance costs related to additional development
equipment of $0.5 million.

    Development and engineering expenses increased 121% to $10.5 million in
2000 from $4.8 million in 1999. The increase was primarily due to the addition
of 41 employees, which included employees assumed in the acquisition of
TriVida, which resulted in increased personnel and related costs of $3.3
million.

General and Administrative Expenses

    General and administrative expenses principally consist of payroll and
related costs and professional fees related to our general management, finance
and human resource functions.

    General and administrative expenses increased 34% to $8.6 million in 2001
from $6.4 million in 2000. The increase is attributable to additional expenses
relating to merger and acquisition planning and other investment banking and
legal services of $1.3 million, an increase in the cost of directors and
officers insurance of $0.3 million, an increase in franchise and other
non-income taxes of $0.3 million.

    General and administrative expenses increased 126% to $6.4 million in 2000
from $2.8 million in 1999. The increase was due to the addition of 19 employees
resulting in personnel costs of $1.3 million. Also contributing to the increase
was approximately $1.0 million in increased professional service fees relating
to legal and investor relations associated with domestic and international
growth during 2000. Additionally, we increased our allowance for doubtful
accounts in connection with our on-going review of outstanding receivables by
$0.6 million.

                                      16

<PAGE>

Equity Related Compensation Expenses

    Equity related compensation expenses are non-cash charges representing the
difference between the exercise price of options to purchase common stock
granted to our employees or the price paid for restricted stock sold to our
employees and the fair value of the options or stock on the date of the option
grant or stock purchase, as determined for financial reporting purposes. These
expenses are recorded over the vesting period of the applicable option or stock
award. These expenses also include the fair value of options granted to
consultants as of the date of grant, as determined for financial reporting
purposes. These fair values were determined in accordance with Accounting
Principles Board Opinion 25 and Statement of Financial Accounting Standards
123. Equity related compensation expenses were $2.3 million in 2001, $1.7
million in 2000 and $1.9 million in 1999.

    On January 1, 2001, we issued 875,306 shares of restricted stock to
non-officer employees who had previously requested to participate in a
Stock-for-Options benefit program (the "Program"). Under the provisions of the
Program, participating employees exchanged two stock options issued under Be
Free's 1998 Stock Incentive Plan for one share of restricted stock with a
purchase price of $0.01 per share. The first 25% of the restricted stock
purchased vests 15 months from the original stock option grant date. An
additional 25% vests each year after the first vest date, for a period of three
years. In connection with the Program, the Company recorded unearned
compensation for restricted stock granted to employees below fair value of $1.9
million. The Company will recognize this compensation expense over the vesting
period of the restricted stock, which is based on the remaining vesting period
of the cancelled options. During 2001, the balance of the unearned compensation
was reduced by $0.7 million associated with the departure of employees with
unvested shares of restricted stock that were repurchased by the Company.

Restructuring Charges

    Throughout 2001, in response to a reduction in our customer base and longer
than anticipated sales cycles, our management executed plans to restructure
several areas of the company. The restructuring included the termination of a
total of 118 employees, representing approximately 41% of the total workforce,
the consolidation of certain office space and a non-cash write-off of excess
and idle equipment. As a result, we recorded restructuring charges totaling
$5.1 million during the year.

    The restructuring charge comprises cash charges totaling $3.0 million,
including severance costs for terminated employees of $1.8 million, a charge
for future lease payments for unutilized office space of $0.9 million and other
restructuring costs of $0.3 million. At December 31, 2001, $2.1 million of the
cash charges had been paid. We expect the remaining $0.9 million, principally
relating to future lease payments for unutilized office space, to be paid over
the next three years. We also recognized a non-cash write-off of excess and
idle equipment and leasehold improvements on unutilized office space of $2.1
million.

Intangible Amortization, Merger Related Expenses And Charge For Impairment Of
Assets

    Amortization, merger related expenses and impairment charges increased 155%
to $118.4 million in 2001 from $46.5 million in 2000. During 2001, these
expenses include amortization expense of intangible assets of $15.7 million and
an impairment charge of $102.7 million. During 2000, these

                                      17

<PAGE>

expenses included one-time acquisition related costs of $0.6 million, primarily
for employee severance, and amortization expense related to the intangible
assets acquired of $45.9 million. We did not record any amortization or merger
related costs in 1999.

    In accordance with SFAS No. 121, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to Be Disposed Of", we review
goodwill and other long-lived assets for impairment whenever events or changes
in circumstances indicate that the carrying amount of these assets may exceed
their fair value. We consider several factors in determining whether an
impairment may have occurred, including the intended use of the underlying
asset, our market capitalization compared to our book value per share, the
overall business climate and current estimates for expected operating results
of acquired businesses. Based on our assessment at March 31, 2001, we decided
that the technology obtained through the acquisition of TriVida would no longer
be integrated into the BFAST technology as originally intended due to the
deterioration of the Internet retail market and customer feedback as well as
other business factors considered. As a result of this decision and a review of
the other factors, we concluded that an impairment assessment was required for
the long-lived assets of TriVida as of March 31, 2001.

    We grouped all long-lived assets for TriVida, including goodwill and other
intangible assets, and estimated the future discounted cash flows related to
these long-lived assets. The discount rate used was based on the risks
involved. As a result of this analysis, we recorded an impairment charge in the
three months ended March 31, 2001, totaling $102.7 million, which represented
the excess of the carrying amount of the TriVida assets over the estimated
discounted cash flows. This charge resulted in a write-off of the balance of
goodwill of $70.3 million, an impairment of other intangible assets of $30.3
million and an impairment of other long-lived assets of $2.1 million. The
remaining carrying amount of the assets will be amortized over their remaining
useful lives.

Interest Income (Expense), Net

    Interest income (expense), net consists of interest income earned on our
cash and marketable securities balances partially offset by interest expense on
our borrowings.

    Net interest income decreased 24% to $6.7 million in 2001 from $8.9 million
in 2000. Net interest income of $6.7 million in 2001 resulted from $7.1 million
of interest income and $0.4 million of interest expense. Net interest income of
$8.9 million in 2000 resulted from interest income of $9.4 million and interest
expense of $0.5 million. The decrease in interest income was the result of a
decrease in cash, cash equivalents and marketable securities and a decrease in
the yield on our portfolio due to decreases in overall interest rates. Net
interest income of $0.3 million was recognized in 1999. Interest income of $1.3
million in 1999 from the investment of a portion of the proceeds from our
initial public offering was partially offset by interest expense of $0.9
million relating to debt obligations.

Extraordinary Item

    The balance of deferred financing costs of $0.3 million associated with a
$5.0 million subordinated debt financing resulted in an extraordinary loss upon
the early extinguishment of the debt in 1999. We did not record any
extraordinary items in 2001 or 2000.


                                      18

<PAGE>

Liquidity and Capital Resources

    Cash and cash equivalents and marketable securities decreased 14% to $133.1
million at December 31, 2001 from $153.9 million at December 31, 2000. In 2001,
cash and cash equivalents increased by $31.5 million and marketable securities
decreased by $52.2 million. This reflects our treasury strategy to invest
excess cash, obtained primarily through our public offerings, in high credit
quality commercial papers and government obligations with a shorter maturity.

    In 2000, cash and cash equivalents and marketable securities increased 93%
to $153.9 million from $79.7 million at December 31, 1999. In 2000, cash and
cash equivalents decreased by $31.4 million and marketable securities increased
by $105.6 million. This reflects our treasury strategy to invest excess cash
obtained primarily through our public offerings, in marketable securities which
yield a higher return than cash and cash equivalents.

    Cash used in operating activities was $12.4 million in 2001. The cash use
resulted from a net loss of $142.0 million, which included non-cash charges
totaling $129.4 million. These non-cash charges included an impairment charge
for long-lived assets of $102.7 million, depreciation and amortization of $21.4
million, impairment of excess and idle equipment of $2.1 million, equity
related compensation of $2.3 million and restructuring costs of $0.8 million.
In addition, the cash use resulted from a decrease in accounts payable of $0.6
million and a decrease in accrued expenses of $0.7 million, which were
partially offset by cash provided by a decrease in accounts receivable of $1.0
million. The decreases in accounts payable and accrued expenses are
attributable to the overall decrease in spending as a result of our
restructuring actions and cost containment programs. The decrease in accounts
receivable is a result of our cash collection efforts resulting in an overall
improvement in the aging of accounts receivable.

    In 2000, cash used in operating activities was $18.9 million. The use of
cash resulted from our net loss of $64.9 million, which included non-cash
charges totaling $52.7 million. These non-cash charges included depreciation
and amortization of $50.5 million and equity related compensation of $1.7
million and provisions for doubtful accounts of $0.6 million. In addition, the
cash use resulted from an increase in accounts receivable of $3.6 million, a
cash use for accounts payable totaling $1.8 million and an increase of other
assets of $2.8 million. The increase in accounts receivable was attributable to
the growth in our customer base and longer payment cycles of some of our
customers. The use of cash resulting from the increase in other assets is
primarily attributable to interest receivable from investments in marketable
securities. The cash used in accounts payable was primarily due to the payment
of liabilities assumed in the acquisition of TriVida, offset by timing
differences in vendor payments. These amounts were partially offset by cash
provided from the increase in accrued expenses of approximately $1.1 million
primarily resulting from timing differences in the processing of the payment of
our merchants' partner commissions which were made subsequent to December 31,
2000.

    Cash provided by investing activities was $47.8 million in 2001. Purchases
and sales of marketable securities in 2001 totaled $161.3 million and $213.5
million, respectively. Capital expenditures totaled $4.4 million in 2001. These
capital expenditures were largely related to the purchase of additional system
and storage equipment for our data centers.


                                      19

<PAGE>

    In 2000, cash used by investing activities was $117.2 million. Purchases
and sales of marketable securities totaled $268.9 million and $163.8 million,
respectively. Capital expenditures of $8.6 million were largely related to
additional system and storage equipment.

    Cash used in financing activities was $3.9 million in 2001. The cash use is
attributable to the payment of our capital lease obligations of $2.7 million
and repurchases of 1.3 million shares of our Common Stock under the stock buy
back program totaling $1.8 million. This was partially offset by the cash
provided by the exercise of stock options and the proceeds from the Employee
Stock Purchase Plan of $0.2 million and $0.3 million, respectively.

    In 2000, cash provided by financing activities was $104.7 million. This
cash was primarily provided through the issuance of Common Stock in our
secondary offering in exchange for net proceeds of $104.7 million. In addition,
cash provided by the issuance of Common Stock in connection with our Employee
Stock Purchase Plan and the exercise of options and warrants totaled $1.7
million and payments from stockholders on notes receivable were $0.1 million.
These amounts were partially offset by payments on capital lease arrangements
totaling $1.8 million.

    In April 2001, we announced that our Board of Directors had authorized the
repurchase of up to $20.0 million of our Common Stock. Purchases were
authorized to be made throughout the remainder of 2001 in the open market or in
privately negotiated transactions depending on market conditions. Shares
acquired would be available for use under our employee stock plans and for
other corporate purposes. This program expired on December 31, 2001. At
December 31, 2001, we had repurchased 1,328,500 shares of our Common Stock for
an aggregate of $1.8 million.

    The following table provides information related to our contractual cash
obligations under various financial and commercial agreements as of December
31, 2001:

<TABLE>
<CAPTION>
                                               Payments Due by Period
                                    --------------------------------------------
Contractual Obligations              2002   2003   2004  2005 Thereafter  Total
-----------------------             ------ ------ ------ ---- ---------- -------
<S>                                 <C>    <C>    <C>    <C>  <C>        <C>
Capital lease obligations.......... $2,236 $  621 $   -- $ --   $   --   $ 2,857
Operating lease obligations........  2,775  1,914  1,409  516    1,091     7,705
Other long-term obligations (1)....     --    275    204   --       --       479
                                    ------ ------ ------ ----   ------   -------
 Total contractual cash obligations $5,011 $2,810 $1,613 $516   $1,091   $11,041
                                    ====== ====== ====== ====   ======   =======
</TABLE>
--------
(1) These amounts represent future lease payments for unutilized office space
    included in our restructuring charge.

    We believe that our current cash, cash equivalents and marketable
securities balances and borrowings will be sufficient to meet our debt service,
operating and capital requirements for at least the next 12 months. While we do
not anticipate that this would be necessary, if cash were insufficient to
satisfy our liquidity requirements, we may seek to raise additional funds
through additional borrowings, public or private equity financings or from
other sources. There can be no assurance that additional financing will be
available at all or, if available, will be on terms acceptable to us. The
issuance of additional equity securities could result in additional dilution to
our stockholders.


                                      20

<PAGE>

Selected Quarterly Financial Data (unaudited)

<TABLE>
<CAPTION>
                                           Quarter Ended
                       ----------------------------------------------------
    <S>                <C>         <C>        <C>             <C>
                        March 31,   June 30,   September 30,   December 31,
                          2001        2001         2001            2001
                       ----------  ---------  --------------  -------------
                               (In thousands, except per share data)
    Revenue........... $    5,422  $   5,525  $        5,999  $       6,468
    Net loss..........   (124,127)    (7,706)         (6,439)        (3,743)
    Net loss per share      (1.94)     (0.12)          (0.10)         (0.06)

                                           Quarter Ended
                       ----------------------------------------------------
                        March 31,   June 30,   September 30,   December 31,
                          2000        2000         2000            2000
                       ----------  ---------  --------------  -------------
                               (In thousands, except per share data)
    Revenue........... $    3,629  $   4,320  $        5,330  $       6,406
    Net loss..........     (9,344)   (19,118)        (18,230)       (18,220)
    Net loss per share      (0.17)     (0.31)          (0.29)         (0.29)
</TABLE>

Recent Accounting Pronouncements

    In June 2001, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards (SFAS) No. 143, "Accounting for
Asset Retirement Obligations", which is effective January 1, 2003. SFAS No. 143
addresses the financial accounting and reporting for obligations and retirement
costs related to the retirement of tangible long-lived assets. We do not expect
that the adoption of SFAS No. 143 will have a material impact on our financial
statements.

    In July 2001, the FASB issued SFAS No. 141, "Business Combinations" and
SFAS No. 142, "Goodwill and Other Intangible Assets". SFAS No. 141 requires
that all business combinations be accounted for under the purchase method only
and that certain acquired intangible assets in a business combination be
recognized as assets apart from goodwill. SFAS No. 142 requires that ratable
amortization of goodwill be replaced with periodic tests of the impairment of
goodwill and that intangible assets other than goodwill be amortized over their
useful lives. SFAS No. 141 is effective for all business combinations initiated
after June 30, 2001. The provisions of SFAS No. 142 will be effective for
fiscal years beginning after December 15, 2001, and we will adopt SFAS No. 142
as required, in the year ending December 31, 2002. The impact of SFAS No. 141
and SFAS No. 142 on our financial statements has not yet been determined.

    In August 2001, the FASB issued SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets", which is effective January 1,
2002. SFAS No. 144 supersedes SFAS No. 121, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to Be Disposed Of", and the
accounting and reporting provisions relating to the disposal of a segment of a
business of Accounting Principles Board Opinion No. 30. We do not expect that
the adoption of SFAS No. 144 will have a material impact on our financial
statements.

                                      21

<PAGE>

Factors That May Affect Future Results

    We operate in a rapidly changing environment that involves a number of
risks, some of which are beyond our control. The following discussion
highlights some of the risks that may affect future operating results.

We have entered into a merger agreement that may be difficult to integrate and
may divert management attention.

    We have entered into a merger agreement with ValueClick, Inc. Management
has spent time evaluating this business combination in the past and expects to
devote considerable effort to completing the transaction. Mergers such as the
one anticipated are typically accompanied by a number of risks, including
difficulties integrating operations and personnel, potential disruption of
ongoing business, potential distraction of management, potential revenue
declines as a result of customer uncertainty, potential loss of employees in
anticipation of the uncertainties of integration, expenses related to the
merger and potential unknown liabilities associated with combined businesses.
We may incur substantial expenses and devote significant management time and
resources in seeking to complete the proposed merger that ultimately may not
generate benefits for us. If we are not successful in completing the merger, we
may be required to pay a termination fee of $5.1 million and a reimbursement of
ValueClick expenses of $1.3 million and we may be required to reevaluate our
growth strategy.

Our limited operating history makes the evaluation of our business and
prospects difficult.

    We introduced our first online marketing services and recorded our first
revenue from these services in the third quarter of 1997 and the market for
these services is still evolving. Accordingly, you have limited information
about our company with which to evaluate our business, strategies and
performance and an investment in our Common Stock. Before buying our Common
Stock, you should consider the risks and difficulties frequently encountered by
early stage companies in new and evolving markets, particularly those companies
whose business depends on the Internet.

We have a history of losses and expect future losses.

    Our accumulated deficit as of December 31, 2001 was $231.9 million. Our
current business has never achieved profitability and we expect to continue to
incur losses for the foreseeable future in light of the level of our
amortization of intangible assets and planned operating and capital
expenditures. We also expect to experience negative operating cash flow for the
near future as we fund our operating losses and capital expenditures. If our
revenue grows more slowly than we anticipate, or if our operating expenses
exceed our expectations and cannot be adjusted in a timely manner, our
business, results of operations, financial condition and prospects would be
materially and adversely affected. We will need to generate significant
additional revenue to achieve profitability. The near-term economic outlook is
very uncertain, especially in light of recent terrorist activities and the
current and expected future responses to such activities. As a result, the
level of commerce, including amounts conducted over the Internet, may be
materially and adversely affected which would materially and adversely affect
our revenue and profitability. Continued economic slowdown could cause
companies to defer or reduce expenditures on online marketing programs, which
could materially and adversely affect our revenue and profitability. Even if we
do achieve profitability, we may not be able to sustain or increase
profitability on a quarterly or annual basis in the future.

                                      22

<PAGE>

Agreements with our customers are not always long-term which could result in
customer loss.

    We provide services to our customers pursuant to contracts, many of which
are not long-term. As a result, many of our customers are not bound to use our
services for an extended period of time. If customers choose not to continue to
use our services, we may have difficulty replacing departing customers with new
customers in a timely or effective manner. If we fail to develop and sustain
long-term relationships with our customers, our business would be materially
harmed.

If the Internet fails to grow as an advertising, marketing and sales medium,
our future revenue and business prospects would be materially and adversely
affected.

    Our future revenue and business prospects depend in part on a significant
increase in the use of the Internet as an advertising, marketing and sales
medium. Internet advertising and marketing is new and rapidly evolving, and it
cannot yet be compared with traditional advertising media or marketing programs
to gauge its effectiveness.

    As a result, demand for, and market acceptance of Internet advertising and
marketing solutions are uncertain. Further, the Internet is still emerging as a
significant channel for selling goods and services to consumers. Our business
and prospects will be materially and adversely affected if the Internet does
not become further accepted as an advertising and marketing medium or if
consumers do not increasingly purchase goods and services online. The adoption
of Internet advertising and marketing services, particularly by entities that
have historically relied upon more traditional methods, requires the acceptance
of a new way of advertising and marketing. These customers may find Internet
advertising and marketing to be less effective for meeting their business needs
than other methods of advertising and marketing.

Because our business model is new and unproven, we do not know if we will
generate significant revenue on a sustained basis or achieve profitability.

    Substantially all of our revenue is derived from a new business model. Our
revenue depends on whether the online marketing that we facilitate generates
sales or traffic for our customers. In contrast, others earn fees based merely
on placing online advertisements for customers. Our customers' marketing
partners may not generate substantial volumes of sales or traffic for our
customers. Similarly, our customers' product and service offerings may not be
sufficient to attract or retain their marketing partners. In these situations,
we may lose revenue and, ultimately, customers. Our business also requires that
we have access to our customers' internal catalog, transactional and
fulfillment systems to track, store and analyze sales and traffic data. If
customers regard this information as too sensitive to share with us, we may
lose customers or businesses might forgo our marketing services entirely. In
addition, because the provision of our services requires us to provide a
connection to the Internet sites of our customers and their marketing partners,
we may be perceived as being associated with the content of these Internet
sites and could face potential liability for defamatory or other materials
displayed on such sites. As a result, we could experience a loss of customers
or reputational harm. If the assumptions underlying our business model are not
valid or we are unable to implement our business plan, achieve the predicted
level of customers and market penetration or obtain the desired level of
pricing of our services for sustained periods, our business, prospects, results
of operations and financial condition and cash flows will be materially and
adversely affected.

                                      23

<PAGE>

System disruptions and failures may result in customer dissatisfaction,
customer loss or both, which could materially and adversely affect our
reputation and business.

    The continued and uninterrupted performance of the computer systems used by
us, our customers and their marketing partners is critical to our success.
Customers may become dissatisfied by any system failure that interrupts our
ability to provide our services to them. These failures could affect our
ability to deliver and track promotions quickly and accurately to the targeted
audience and deliver reports to our customers and their marketing partners.
Sustained or repeated system failures would reduce the attractiveness of our
services significantly. Our operations depend on our ability to protect our
computer systems against damage from fire, power loss, water damage,
telecommunications failures, vandalism and similar unexpected adverse events.
In addition, interruptions in our services could result from the failure of
telecommunications providers to provide the necessary data communications
capacity in the time required. Despite our efforts to implement network
security measures, our systems are also vulnerable to computer viruses,
break-ins and similar disruptions from unauthorized tampering. We do not carry
enough business interruption insurance to compensate for any significant losses
that may occur as a result of any of these events. Further, because our systems
interact with the systems of our customers and their marketing partners, any
such interruptions to their systems would also affect our ability to provide
our services to them, which could result in customer dissatisfaction or
customer loss.

    We have experienced systems outages and denial of service interruptions in
the past, during which we were unable to route transactions to our customers
from their marketing partners or provide reports. We expect to experience
additional outages in the future. To date, these outages have not had a
material adverse effect on us. However, in the future, a prolonged system-wide
outage or frequent outages could cause harm to our reputation and could cause
our customers or their marketing partners to make claims against us for damages
allegedly resulting from an outage or interruption. The expansion of our
existing data centers and the opening of additional data centers may not
eliminate systems outages or prevent the loss of sales when system outages
occur. Any damage or failure that interrupts or delays our operations could
result in material harm to our business and expose us to material liabilities.

Intense competition in our markets may reduce the number of our customers and
the pricing of our services.

    We compete in markets that are new, intensely competitive, highly
fragmented and rapidly changing. We compete against larger public companies as
well as against similar sized, private companies. We face competition in the
online marketing services market in general, as well as in the affiliate
marketing program and site personalization segments specifically. We have
experienced and expect to continue to experience increased competition from
current and potential competitors. Our competitors may be able to respond more
quickly to new or emerging technologies and changes in customer requirements
than we can. In addition, our current and potential competitors may bundle
their products with other marketing software or services in a manner that may
discourage users from purchasing services offered by us. Also, many current and
potential competitors have greater name recognition and significantly greater
financial, technical, marketing and other resources than we do. Increased
competition could result in price reductions, fewer customer orders, reduced
gross margins and loss of market share.

                                      24

<PAGE>

We may become exposed to liability or involved in litigation that may adversely
affect us.

    Because the provision of our services requires us to provide a connection
to the Internet sites of our customers and their marketing partners, we may be
exposed to liability for information displayed on our customer's Internet sites
or within their marketing partners' Internet sites. We may also become involved
in litigation, administrative proceedings and governmental proceedings and
could be exposed to liability for such matters or for other matters in the
ordinary course of business. Litigation and involvement in such proceedings can
be time-consuming, divert management's attention and resources and cause us to
incur significant expenses. In addition, any litigation or imposition of
liability, particularly liability that is not covered by insurance or is in
excess of insurance coverage, could have a material adverse effect on our
reputation and our business and financial condition, operating results and cash
flows.

Any breach of our system's security measures that results in the release of
confidential customer data could cause customer dissatisfaction, customer loss,
or both and expose us to lawsuits.

    Third parties may attempt to breach our security. If they are successful,
they could obtain our customers' or their marketing partners' confidential
information, including marketing data, sales data, passwords, and financial
account, performance and contact information. A breach of security could
materially and adversely affect our reputation, business and prospects. We rely
on encryption technology licensed from third parties. Our systems are
vulnerable to computer viruses, physical or electronic break-ins and similar
disruptions, which could lead to interruptions, delays or loss or theft of
data. We may be required to expend significant capital and other resources to
license encryption technology and additional technologies to protect against
security breaches or to alleviate problems caused by any breach. We may be
liable for any breach in our security and any breach could harm our reputation,
reduce demand for our services or cause customers to terminate their
relationships with us.

If our system produces inaccurate information, we may experience customer
dissatisfaction, customer loss, or both and be exposed to lawsuits.

    Software defects or inaccurate data may cause incorrect recording,
reporting or display of information to our customers, their marketing partners
or both. Inaccurate information could cause our customers to over-pay or
under-pay their marketing partners. As a result, we could be held liable for
any damages incurred by our customers or their marketing partners. In addition,
we provide an optional payment service for our customers. Software defects and
inaccurate data may cause us to send payments to the wrong party, in the wrong
amounts, or on an untimely basis, any of which could cause liability for us,
lead to customer dissatisfaction, or both. Our services depend on complex
software that we have internally developed or licensed from third parties.
Software often contains defects, particularly when first introduced or when new
versions are released, which can adversely affect performance or result in
inaccurate data. We may not discover software defects that affect our new or
current services or enhancements until after they are deployed. In addition,
our services depend on our customers and their marketing partners supplying us
with data regarding contacts, performance and sales. If we are provided with
erroneous or incomplete data, we may produce inaccurate information. Although
such inaccuracies may be neither our fault or responsibility, we may still
experience customer dissatisfaction or loss as a result.

                                      25

<PAGE>

To be competitive, we must continue to develop new and enhanced services, and
our failure to do so may adversely affect our prospects.

    Our market is characterized by rapid technological change, frequent new
service introductions, change in customer requirements and evolving industry
standards. The introduction of services embodying new technologies and the
emergence of new industry standards could render our existing services
obsolete. Our revenue growth depends upon our ability to introduce or develop a
variety of new services and service enhancements to address the increasingly
sophisticated needs of our customers. We have experienced delays in releasing
new services and service enhancements and may experience similar delays in the
future. To date, these delays have not had a material effect on our business.
If we experience material delays in introducing new services and enhancements,
customers may forgo purchasing or renewing our services and purchase those of
our competitors.

If government regulations and legal uncertainties related to doing business on
the Internet cause a decline in e-commerce and Internet advertising and
marketing, our business and prospects could be materially and adversely
affected.

    Laws and regulations directly applicable to Internet communications,
commerce, marketing and privacy are becoming more prevalent. The United States
Congress has enacted Internet laws regarding children's privacy, copyrights and
taxation. The United States and the European Union recently enacted privacy
regulations that may result in limits on the collection and use of some user
information. The United States and other countries may adopt additional
legislation or regulatory requirements covering issues such as user privacy,
pricing, content, taxation and quality of products and services, among other
items. The governments of states and foreign countries might attempt to
regulate our transmissions or levy sales or other taxes relating to our
activities. The laws governing the Internet remain largely unsettled, even in
areas where legislation has been enacted. It may take years to determine
whether and how existing laws such as those governing intellectual property,
privacy, libel and taxation apply to the Internet and Internet advertising and
marketing services. In addition, the growth and development of the market for
Internet commerce may prompt calls for more stringent consumer protection laws,
both in the United States and abroad, that may impose additional burdens on
companies conducting business over the Internet. To date, these regulations
have not materially restricted the use of our services or our business
growth.

If privacy concerns cause a significant number of Internet users to avoid
Internet sites that track behavioral information, opt-out of online profiling
or use software to prevent online profiling, our business prospects could
decline materially.

    We gather and maintain anonymous data related to consumer online browsing
and buying behavior. When a user first views or clicks on a customer's
promotion managed by our system, we create an anonymous profile for that user
and we add and change profile attributes based upon that user's behavior on our
customer's Internet site and its marketing partners' Internet sites. Privacy
concerns may cause visitors to avoid Internet sites that track behavioral
information and even the perception of security and privacy concerns, whether
or not valid, may indirectly inhibit market acceptance of our services. We host
an Internet site which allows consumers to opt not to have their anonymous
profile gathered and maintained by us. Also, software programs exist that limit
or prevent

                                      26

<PAGE>

the use of "cookies" which are required for us to gather the anonymous data.
Widespread use of the opt-out capability or adoption of this software by
Internet users could significantly undermine the commercial viability of our
BSELECT Onsite service. This development could cause our business prospects to
decline materially.

If we fail to protect our intellectual property rights, our business and
prospects could be materially and adversely affected.

    We seek to protect our proprietary rights through a combination of patent,
copyright, trade secret and trademark law and assignment of invention and
confidentiality agreements. The unauthorized reproduction or other
misappropriation of our proprietary rights could enable third parties to
benefit from our technology without paying us for it. If this occurs, our
business could be materially and adversely affected. We have also filed
applications to register various servicemarks. We cannot assure you that any of
our servicemark registrations will be approved.

If we infringe upon the intellectual property rights of others, we could be
exposed to significant liability.

    We cannot assure you that our patent or any future patents or servicemark
registrations we receive will not be successfully challenged by others or
invalidated. In addition, we cannot assure you that we do not infringe any
intellectual property rights of third parties or that we will be able to
prevent misappropriation of our technologies, particularly in foreign countries
where laws or law enforcement practices may not protect our proprietary rights
as fully as in the United States. There have been a number of patents granted
relating to online commerce, advertising and affiliate marketing programs.
Further, we believe that an increased number of such patents may be filed in
the future. To date, we have not been notified that our technologies infringe
the intellectual property rights of third parties, but in the future third
parties may claim that we infringe on their past, current or future
intellectual property rights. Any such claim brought against us or our
customers, whether meritorious or not, could result in loss of revenue, be
time-consuming to defend, result in costly litigation, or require us to enter
into royalty or licensing agreements. If we were unable to enter into such
royalty or licensing agreements, it could result in the significant
modification or cessation of our business operations.

We depend on a limited number of hardware and software vendors for essential
products. If we were unable to purchase or license these essential products on
acceptable terms or if we had to obtain substitutes for these essential
products from different vendors, we might suffer a loss of revenue due to
business interruption and might incur higher operating costs.

    We buy and lease hardware, including our servers and storage arrays from
Sun Microsystems and EMC Corporation. We also license software, including our
servers' operating systems, Internet server technology, database technology,
graphical user interface technology and encryption technology, primarily from
Sun Microsystems, Microsoft Corporation, Oracle Corporation and PowerSoft. If
these vendors change the terms of our license arrangements with them so that it
would be uneconomical to purchase our essential products from them, or if they
were unable or unwilling to supply us with a sufficient quantity of properly
functioning products, our business could be materially and adversely affected
due to business interruption caused by any delay in product and service
development until equivalent technology can be identified and the cost of
integrating new technology.

                                      27

<PAGE>

We expect our operating results to fluctuate and the price of our Common Stock
could fall if quarterly results are lower than the expectations of securities
analysts or stockholders.

    We believe that quarter-to-quarter comparisons of our operating results are
not necessarily meaningful. You should not rely on the results of one quarter
as an indication of our future performance. If our quarterly operating results
fall below the expectations of securities analysts or stockholders, however,
the price of our Common Stock could fall. We have experienced significant
fluctuation in our quarterly operating results and may continue to experience
significant fluctuation.

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

    We do not currently use derivative financial instruments. We generally
place our marketable security investments in high credit quality instruments,
primarily U.S. government obligations, tax-exempt municipal obligations and
corporate obligations with contractual maturities of two years or less. An
increase or decrease in interest rates of 100 to 200 basis points would not
materially affect the fair value of our investment portfolio as of December 31,
2001.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

    See Index to Financial Statements which appears on page F-1 hereof.

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

    None.

                                      28

<PAGE>

                                   PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

    Our directors and executive officers, and their respective ages and
positions as of March 8, 2002, are set forth below:

<TABLE>
<CAPTION>
        Name          Age                                 Position
        ----          ---                                 --------
<S>                   <C> <C>
Gordon B. Hoffstein.. 49  President, Chief Executive Officer and Chairman of the Board of Directors
Samuel P. Gerace, Jr. 38  Executive Vice President, Chief Technology Officer and Director
Stephen M. Joseph.... 43  Executive Vice President, Chief Financial Officer and Treasurer
W. Blair Heavey...... 39  Executive Vice President, Sales and Marketing
Steven D. Pike....... 48  Executive Vice President, Client Services
Kathleen L. Biro..... 49  Director
Ted R. Dintersmith... 49  Director
W. Michael Humphreys. 50  Director
Jeffrey F. Rayport... 42  Director
</TABLE>

    Gordon B. Hoffstein has been our President and Chief Executive Officer and
a director since August 1998, and was elected Chairman of the Board of
Directors in January 2000. From October 1991 to April 1997, he was a co-founder
and the Chief Executive Officer of PCs Compleat, a direct marketer of PCs and
related products now known as CompUSA Direct. He currently serves as a director
of various private companies. Mr. Hoffstein earned a B.S. from the University
of Massachusetts and an M.B.A. from Babson College.

    Samuel P. Gerace, Jr. has been our Executive Vice President, Chief
Technology Officer and a director since August 1998. He was a founder of and
has been involved in managing our business since the inception of one of our
affiliated companies in September 1985. Mr. Gerace holds an A.B. from Harvard
College.

    Stephen M. Joseph has been our Executive Vice President and Chief Financial
Officer since August 1998. From October 1991 to December 1997, he served as
Chief Financial Officer of PCs Compleat, Inc. Mr. Joseph earned a B.S. from
Bentley College.

    W. Blair Heavey has been our Executive Vice President, Sales since October
1998. In March 2002, Mr. Heavey assumed the role of Executive Vice President,
Sales and Marketing. From April 1995 until joining us, he held sales positions
at Open Market, Inc., an Internet software developer, including Director of
Sales and Director, Strategic Channel Sales. Mr. Heavey received a B.A. from
Boston College and a M.B.A. from Babson College.

    Steven D. Pike has been our Executive Vice President, Client Services since
April 1999. From July 1998 until joining us, he served as Vice President,
Customer Services at Internet Commerce Services, Inc., a commerce service
provider. From September 1995 to June 1998, he held the position of Director of
Technical Services at Open Market, Inc. Mr. Pike holds a B.S. from Franklin
Pierce College.

                                      29

<PAGE>

    Kathleen L. Biro has been a director since January 2000. Since 1991, Ms.
Biro has been employed by Digitas, an Internet professional services firm, in a
variety of capacities, including since December 1999 as its President and a
director and as Vice Chairman since April 1999. Ms. Biro co-founded Strategic
Interactive Group, an interactive advertising firm and predecessor to Digitas,
and served as its Chief Executive Officer from its founding in April 1995 to
December 1999. Ms. Biro holds a B.S. and an M.S. in Educational Administration
from New York University and an M.B.A. in Marketing and Finance from the
Columbia University Graduate School of Business.

    Ted R. Dintersmith has been a director since August 1998. Since February
1996, he has been an Investing Principal at Charles River Ventures, a private
venture capital firm. Mr. Dintersmith holds a B.A. degree in Physics and
English from the College of William and Mary and a Ph.D. in Engineering from
Stanford University.

    W. Michael Humphreys has been a director since August 1998. He has been a
partner of Matrix Partners, a private venture capital firm, since 1979. Mr.
Humphreys received a B.S. from the University of Oregon and an M.B.A. from
Harvard Business School.

    Jeffrey F. Rayport has been a director since December 1998. Dr. Rayport
currently works at Monitor Group, a management consulting firm, as the founder
and Chief Executive Officer of Monitor Marketspace, an e-commerce research and
media unit established in 1998. From 1991 to 2000, he was a faculty member at
Harvard Business School in the Service Management Unit. He currently serves as
a director of Global Sports Interactive and CBS MarketWatch. Dr. Rayport earned
an A.B., A.M. and Ph.D. from Harvard University and an M. Phil. from the
University of Cambridge (U.K.).

Board Structure

    Our current Board is divided into three classes. A class of directors is
elected each year for a three-year term. Our Class I directors, who will
continue in office until our 2003 Annual Meeting of Stockholders, are W.
Michael Humphreys and Kathleen L. Biro. Our Class II directors, who will
continue in office until our 2004 Annual Meeting of Stockholders, are Ted R.
Dintersmith and Jeffrey F. Rayport. Our Class III Directors, whose terms will
expire at this year's Annual Meeting of Stockholders, are Gordon B. Hoffstein
and Samuel P. Gerace, Jr. Messrs. Hoffstein and Gerace have each been nominated
for election as a Class III Director at this year's Annual Meeting of
Stockholders, and both are available for re-election as a Class III Director.
The Class III Directors elected at this year's Annual Meeting of Stockholders
will serve for a term of three years which will expire at the Company's 2005
Annual Meeting of Stockholders and until their successors are elected and
qualified.

Section 16(a) Beneficial Ownership Reporting Compliance

    Section 16(a) of the Exchange Act requires the Company's directors and
executive officers, and persons who beneficially own more than ten percent of a
registered class of the Company's equity securities, to file reports of
beneficial ownership and changes in beneficial ownership with the Securities
and Exchange Commission. Based solely on its review of the copies of such forms
received or written representations from certain reporting persons, the Company
believes that, during fiscal 2001, its officers, directors and ten-percent
stockholders complied with all applicable Section 16(a) filing requirements
applicable to such individuals.

                                      30

<PAGE>

ITEM 11.  EXECUTIVE COMPENSATION

Director Compensation

    We have no present plans to pay cash compensation to directors but intend
to reimburse directors for reasonable out-of-pocket expenses incurred in
connection with attendance at meetings of the Board of Directors or committees
of the Board. From time to time, we grant our non-employee directors options to
purchase shares our our Common Stock under the Stock Incentive Plan. In April
2001, we granted each of Messrs. Dintersmith, Humphreys and Rayport and Ms.
Biro an option to purchase 25,000 shares of Common Stock at $1.24 per share
that vests monthly over 3 years. If the merger with ValueClick is consummated
all of the option grants made to our non-employee directors will accelerate in
full.

Executive Compensation

    The following table sets forth certain information concerning compensation
earned by each of our Chief Executive Officer, the four other most highly
compensated executive officers who were serving as executive officers on
December 31, 2001 and one additional individual who was one of the most highly
compensated executive officers in 2001, but was no longer serving as an
executive officer on December 31, 2001 (the "Named Executive Officers") for the
fiscal years ended December 31, 1999, 2000 and 2001. In accordance with the
rules of the SEC, the compensation set forth in the table below does not
include medical, group life, or other benefits which are available to all of
our salaried employees, and perquisites and other benefits, securities or
property which do not exceed the lesser of $50,000 or 10% of the person's
salary and bonus shown in the table. In the table below, columns required by
the regulations of the SEC have been omitted where no information was required
to be disclosed under those columns.

                          Summary Compensation Table


<TABLE>
<CAPTION>
                                                     Annual Compensation         Long Term Compensation
                                                     ------------------- -----------------------------------
<S>                                             <C>  <C>       <C>       <C>        <C>        <C>
                                                                         Restricted Securities
                                                                           Stock    Underlying    All Other
Name of Executive                               Year  Salary    Bonus      Awards    Options   Compensation (1)
-----------------                               ----  ------    -----      ------    -------   -------------
Gordon B. Hoffstein............................ 2001 $325,000  $100,000       --       342,857       $ --
  President, Chief Executive Officer and        2000  262,500    82,083       --       200,000         --
  Chairman of the Board of Directors            1999  165,000    63,397       --            --         --

Samuel P. Gerace, Jr........................... 2001  175,000    35,000       --       342,857      2,625
  Executive Vice President and Chief Technology 2000  124,800    94,750       --       200,000         --
 Officer                                        1999  115,000    18,126       --            --         --

W. Blair Heavey (2)............................ 2001  143,329   150,020       --       342,857      2,625
  Executive Vice President, Sales and Marketing 2000  135,000   223,372       --       175,000         --
                                                1999  135,000   163,992       --            --         --

Steven D. Pike................................. 2001  155,000    35,000       --       342,857         --
  Executive Vice President, Client Services     2000  115,995    96,000       --       105,000         --
                                                1999   84,564         -       --       250,000         --

Stephen M. Joseph.............................. 2001  175,000    35,000       --       342,857         --
  Executive Vice President and Chief Financial  2000  114,400    92,250       --       175,000         --
 Officer                                        1999  105,000    23,250       --            --         --

Thomas A. Gerace (3)........................... 2001  237,925    22,731       --       200,000         --
  Former Executive Vice President and           2000  124,800    94,750       --       200,000         --
  Chief Marketing Officer                       1999  115,000    23,914       --            --         --
</TABLE>
--------
(1) Employer contributions to the 401(k) Plan.

(2) Mr. Heavey has been our Executive Vice President, Sales since October 1998.
    In March 2002, Mr. Heavey assumed the role of Executive Vice President,
    Sales and Marketing.

(3) Mr. Gerace left the Company in August, 2001. He served as our Executive
    Vice President and Chief Marketing Officer until that time.

                                      31

<PAGE>

Option Grants in Fiscal Year 2001

    The following table sets forth certain information relating to each grant
of stock options pursuant to the Stock Incentive Plan during the fiscal year
ended December 31, 2001 to each of the Named Executive Officers. No stock
appreciation rights were granted during such fiscal year.

                       Option Grants In Last Fiscal Year

<TABLE>
<CAPTION>
                                                                   Individual Grants
                      --------------------------------------------------------------------------------------------------------------
                                        Percent of
                                          Total
                          Number         Options/      Exercise
                            of             SARs         or Base                                        Potential Realizable Value of
                        Securities      Granted to       Price                                         Assumed Annual Rates of Stock
                        Underlying      Employees         Per            Market                        Price Appreciation for Option
                         Options        in Fiscal        Share         Price Per           Expiration            Term (4)
                       Granted (1)       Year (2)       ($/sh)         Share (3)              Date     -----------------------------
                      ----------------  -----------  --------------  ------------------    ----------   0%        5%         10%
<S>                   <C>                <C>             <C>               <C>             <C>        <C>      <C>       <C>
Gordon B. Hoffstein..     200,000         4.61%        $   1.875       $    1.875         01/09/2011  $ --    $235,835   $597,653
                          142,857         3.29%        $   1.350       $    1.350         10/18/2011  $ --    $121,287   $307,364

Samuel P. Gerace, Jr.     200,000         4.61%        $   1.875       $    1.875         01/09/2011  $ --    $235,835   $597,653
                          142,857         3.29%        $   1.350       $    1.350         10/18/2011  $ --    $121,287   $307,364

W. Blair Heavey......     200,000         4.61%        $   1.875       $    1.875         01/09/2011  $ --    $235,835   $597,653
                          142,857         3.29%        $   1.350       $    1.350         10/18/2011  $ --    $121,287   $307,364

Steven D. Pike.......     200,000         4.61%        $   1.875       $    1.875         01/09/2011  $ --    $235,835   $597,653
                          142,857         3.29%        $   1.350       $    1.350         10/18/2011  $ --    $121,287   $307,364

Stephen M. Joseph....     200,000         4.61%        $   1.875       $    1.875         01/09/2011  $ --    $235,835   $597,653
                          142,857         3.29%        $   1.350       $    1.350         10/18/2011  $ --    $121,287   $307,364

Thomas A. Gerace (5).     200,000         4.61%        $   1.875       $    1.875         01/09/2011  $ --    $235,835   $597,653
</TABLE>

--------
(1) Our standard stock option agreements provide for 25% accelerated vesting
    upon a change in control event and 100% accelerated vesting if, within two
    years of such change in control event, the optionholder is terminated for
    "good reason," including a diminution of authority of responsibility.
    Options granted to Messrs. Samuel P. Gerace, Jr., Heavey, Pike and Joseph
    contain such provisions. Options granted to Mr. Hoffstein contain similar
    provisions, but provide for 50% accelerated vesting upon a change in
    control event instead of 25%.

(2) Based on options to purchase an aggregate of 4,339,823 shares granted to
    our officers and employees under the 1998 Stock Incentive Plan during the
    year ended December 31, 2001.

(3) The exercise price per share of each option was determined to be equal to
    the fair market value per share of the underlying stock on the date of
    grant.

(4) The potential realizable value is calculated based on the term of the
    option at the time of grant. Stock price appreciation of 5% and 10% is
    assumed pursuant to rules promulgated by the SEC and does not represent our
    prediction of our stock price performance. The potential realizable values
    at 5% and 10% appreciation are calculated by assuming that the exercise
    price on the date of grant appreciates at the indicated rate for the entire
    term of the option and that the option is exercised at the exercise price
    and sold on the last day of its term at the appreciated price.

(5) All options granted to Mr. Thomas A. Gerace that were unvested were
    cancelled when Mr. Gerace left the Company in August 2001.


                                      32

<PAGE>

2001 Aggregated Option Exercises and Fiscal Year-End Option Values

    The following table sets forth certain information regarding options
exercised and the number and value of securities underlying unexercised options
that are held by the Named Executive Officers as of December 31, 2001.

                Aggregated Option Exercises In Last Fiscal Year
                       and Fiscal Year-end Option Values

<TABLE>
<CAPTION>
                       Shares             Number of Securities
                      Acquired           Underlying Unexercised   Value of Unexercised In-
                         on     Value          Options at           the-Money Options at
                      Exercise Realized     December 31, 2001       December 31, 2001(1)
                      -------- -------- ------------------------- -------------------------
<S>                   <C>      <C>      <C>         <C>           <C>         <C>
                                        Exercisable Unexercisable Exercisable Unexercisable
                      -------- -------- ----------- ------------- ----------- -------------
Gordon B. Hoffstein..     --       --            --       342,857          --       159,000
Samuel P. Gerace, Jr.     --       --            --       342,857          --       159,000
W. Blair Heavey......     --       --       191,263       402,400     376,786       276,300
Steven D. Pike.......     --       --       122,916       426,190     142,812       256,500
Stephen M. Joseph....     --       --            --       342,857          --       159,000
Thomas A. Gerace.....     --       --            --            --          --            --
</TABLE>
_____________
(1) On December 31, 2001 the last sale price reported on the Nasdaq National
    Market for our Common Stock was $2.12 per share.

Employment Contracts, Termination of Employment and Change in Control
Arrangements

    The Company's standard stock option and restricted stock agreements provide
for 25% accelerated vesting upon a change in control event and 100% accelerated
vesting if, within two years of such change in control event, the optionholder
or stockholder is terminated for "good reason," including a diminution of
authority of responsibility. The terms of these agreements apply generally to
our employees, directors and officers. Options and restricted stock granted to
Mr. Hoffstein provide for 50% accelerated vesting upon a change in control
event instead of 25%.

    Pursuant to an employment agreement with the Company, Mr. Hoffstein is
entitled to receive certain severance payments and continuation of benefits if
terminated.

    In connection with the execution and delivery of the merger agreement with
ValueClick, certain of our officers, directors and stockholders entered into
voting agreements with ValueClick. Each of Charles River Partnership VIII, LP,
Charles River Partnership VIII-A, LLC, Samuel P. Gerace, Jr., Gordon B.
Hoffstein, Ted R. Dintersmith, the Dintersmith Family Limited Partnership,
Jeffrey F. Rayport, W. Blair Heavey, Stephen M. Joseph and Thomas A. Gerace
entered into voting agreements with ValueClick pursuant to which they agreed to
vote an aggregate of 11,245,652 shares of Be Free Common Stock with respect to
which they have voting power in favor of the adoption of the merger agreement.
As of the date of this report, these shares represented approximately 17.1% of
the total voting power of our outstanding shares of capital stock. In addition,
Be Free entered into a voting agreement with certain of ValueClick's officers,
directors and stockholders under which such individuals have agreed to vote an
aggregate of 8,467,548 shares of ValueClick common stock in favor of the
approval of the merger agreement. As of the record date for the ValueClick
annual meeting, these shares of ValueClick common stock represented
approximately 16.3% of the total voting power of the outstanding shares of
ValueClick capital stock. If the merger with ValueClick is consummated, it will
result in a change of control of Be Free.

                                      33

<PAGE>

Compensation Committee Report

    The Compensation Committee of the Board of Directors has furnished the
following report on executive compensation:

    The Company's executive compensation program is administered by the
Compensation Committee. The Compensation Committee, which is comprised of two
outside directors, establishes and administers the Company's executive
compensation policies and plans and administers the Company's stock option and
other equity-related employee compensation plans. The Compensation Committee
considers internal and external information in determining certain executive
officers' compensation, including outside survey data.

Compensation Philosophy

    The Company's compensation policies for executive officers are based on the
belief that the interests of executives should be closely aligned with those of
the Company's stockholders. The compensation policies are designed to achieve
the following objectives:

    .   Offer compensation opportunities that attract highly qualified
        executives, reward outstanding initiative and achievement, and retain
        the leadership and skills necessary to build long-term stockholder
        value.

    .   Maintain a significant portion of executives' total compensation at
        risk, tied to both the annual and long-term financial performance of
        the Company and the creation of stockholder value.

    .   Further the Company's short and long-term strategic goals and values by
        aligning compensation with business objectives and individual
        performance.

Compensation Program

    The Company's executive compensation program has three major integrated
components, base salary, annual incentive awards and long term incentives.

    Base Salary. Base salary levels for executive officers are determined
annually by reviewing the pay practices of Internet companies of similar size
and market capitalization, the skills, performance level, and contribution to
the business of individual executives, and the needs of the Company. Overall,
the Company believes that base salaries for its executive officers are
competitive with median base salary levels for similar positions in comparable
Internet companies.

    Annual Incentive Awards. The Company's executive officers are eligible to
receive annual cash bonus awards designed to motivate executives to attain
short-term and longer-term corporate and individual management goals. The
Compensation Committee establishes the annual incentive opportunity for each
executive officer in relation to his or her base salary. Awards under this
program are based on the attainment of specific company performance measures
and by the achievement of specified individual objectives and the degree to
which each executive officer contributes to the overall

                                      34

<PAGE>

success of the Company and the management team. For 2001, these bonuses were
based on sales growth, the successful execution of the Company's strategies and
other individual objectives, thus establishing a direct link between executive
pay and Be Free's revenue growth.

    Long-Term Incentives. The Compensation Committee believes that stock
options are an excellent vehicle for compensating the Company's officers and
employees. The Company provides long-term incentives through the Stock
Incentive Plan and the 1999 Employee Stock Purchase Plan, the purposes of which
are to create a direct link between executive compensation and increases in
stockholder value. Stock options are granted at fair market value and vest in
installments, generally in 36 monthly installments after the vesting of the
first 25% which occurs upon the one-year anniversary of the grant. When
determining option awards for an executive officer, the Compensation Committee
considers the executive's current contribution to the Company's performance,
the anticipated contribution to meeting the Company's long-term strategic
performance goals, and industry practices and norms. Long-term incentives
granted in prior years and existing levels of stock ownership are also taken
into consideration. Because the receipt of value by an executive officer under
a stock option is dependent upon an increase in the price of the Company's
Common Stock, this portion of the executive's compensation is directly aligned
with an increase in stockholder value.

    Stock for Options Program.  Pursuant to a recommendation of the
Compensation Committee, our Board of Directors approved an employee option
exchange program, pursuant to which eligible employees were permitted to
surrender for cancellation stock options in exchange for a reduced number of
shares of restricted stock. On January 1, 2001, we issued 875,306 shares of
restricted stock to Company employees who previously requested to participate
in the option exchange program. Under the provisions of the program,
participating employees exchanged two stock options for one share of restricted
stock issued under the Stock Incentive Plan with a purchase price of $0.01 per
share. The first 25% of the restricted stock purchased vests 15 months from the
original stock option grant date. An additional 25% vests each year after the
first vest date, for a period of three years.

    The Compensation Committee recommended the employee option exchange program
because it believes it is important to align the interests of our employees
with those of our stockholders. Because many of our outstanding options had
exercise prices that were significantly higher than the then current market
price of our Common Stock, it felt, and the Board of Directors agreed, that it
was advisable and in the best interests of the Company and its stockholders to
offer this employee option exchange program to re-establish the alignment of
interests. Because employees participating in the exchange program received
shares of restricted stock subject to vesting in an amount less than the shares
underlying the options they surrendered, the program limited the dilution to
public stockholders commonly associated with stock option repricing.

Chairman of the Board of Directors, President and Chief Executive Officer

    Mr. Hoffstein's base salary, annual incentive award and long-term incentive
compensation are determined by the Compensation Committee based upon the same
factors as those employed by the Compensation Committee for executive officers
generally. Mr. Hoffstein's current annual base salary is $325,000, subject to
annual review and increase by the Board of Directors of the Company. As of
March 8, 2002, Mr. Hoffstein beneficially owned 3,335,856 shares of Common
Stock.

                                      35

<PAGE>

Section 162(m) Limitation

    Section 162(m) of the Internal Revenue Code of 1986, as amended (the
"Code"), generally disallows a deduction to public companies for compensation
over $1,000,000 paid to the company's chief executive officer and four other
most highly compensated executive officers. Qualifying performance-based
compensation will not be subject to the deduction limit if certain requirements
are met. The Compensation Committee's present intention is to structure its
stock option grants and certain other equity-based awards in a manner that
complies with Section 162(m) of the Code unless the Compensation Committee
believes that such compliance would not be in the best interest of the Company
or its stockholders. Nevertheless, the Compensation Committee reserves the
right to use its judgement to authorize compensation payments which may be in
excess of the Section 162(m) limit when the Committee believes such payments
are appropriate, after taking into consideration changing business conditions
or the officer's performance, and are in the best interests of the stockholders.

                                          COMPENSATION COMMITTEE

                                          Ted R. Dintersmith
                                          W. Michael Humphreys

                                      36

<PAGE>

                            STOCK PERFORMANCE GRAPH

    The graph below compares the cumulative total stockholder return of the
Company's Common Stock from November 3, 1999 through December 31, 2001 with the
cumulative total return of the Nasdaq Composite Index and the Dow Jones
Internet Services Index during the same period. The graph shown below assumes
that $100 was invested in the Company's Common Stock and in each index on
November 3, 1999. In addition, the total returns for the Company's Common Stock
and the indexes used assume the reinvestment of all dividends. Management
cautions that the stock price performance shown in the graph below should not
be considered indicative of potential future stock performance.

          Comparison of Cumulative Total Return Among Be Free, Inc.,
                          the Nasdaq Composite Index
                   and the Dow Jones Internet Services Index


                                    [CHART]
<TABLE>
<CAPTION>
            Be Free, Inc.   NASDAQ Composite    Dow Jones Internet
                                  Index           Services Index
<S>         <C>             <C>                 <C>

 11/3/99      100.00             100.00              100.00
12/31/99      247.84             134.37              175.78
 6/30/00       62.07             130.96              130.46
12/29/00       15.09              81.58               64.99
 6/29/01        8.41              71.36               30.87
12/31/01       14.62              64.40               20.11
</TABLE>





<TABLE>
<CAPTION>
                                                        Cumulative Total Return
                                  --------------------------------------------------------------------
<S>                               <C>         <C>          <C>      <C>          <C>      <C>
                                  November 3, December 31, June 30, December 29, June 29, December 31,
                                     1999         1999       2000       2000       2001       2001
                                  ----------- ------------ -------- ------------ -------- ------------
Be Free, Inc.....................   $100.00     $247.84    $ 62.07     $15.09     $ 8.41     $14.62
Nasdaq Composite Index...........    100.00      134.37     130.96      81.58      71.36      64.40
Dow Jones Internet Services Index    100.00      175.78     130.46      64.99      30.87      20.11
</TABLE>

                                      37

<PAGE>

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

    The following table sets forth information regarding the beneficial
ownership of shares of our Common Stock as of March 8, 2002 by:

    .  each person we know to own beneficially more than 5% of our Common Stock;

    .  each of our directors;

    .  each of our Named Executive Officers; and

    .  all directors and executive officers as a group.

    Unless otherwise indicated, each person named in the table has sole voting
power and investment power, or shares this power with his or her spouse, with
respect to all shares of capital stock listed as owned by such person. The
address of each of our executive officers and directors is c/o Be Free, Inc.,
154 Crane Meadow Road, Marlborough, Massachusetts 01752.

    The number of shares beneficially owned by each stockholder is determined
under rules promulgated by the Securities and Exchange Commission (the "SEC").
The information is not necessarily indicative of beneficial ownership for any
other purpose. Under these rules, beneficial ownership includes any shares as
to which the individual or entity has sole or shared voting power or investment
power and any shares as to which the individual or entity has the right to
acquire beneficial ownership within 60 days after March 8, 2002 through the
exercise of any stock option or other right. The fact that we have included
these shares, however, does not constitute an admission that the named
stockholder is a direct or indirect beneficial owner of the shares.

<TABLE>
<CAPTION>
                                                                Amount and Nature of
                                                                Beneficial Ownership
                                                                --------------------
<S>                                                             <C>       <C>
                                                                Number of Percent of
Name and Address of Beneficial Owner                             Shares      Class
------------------------------------                            --------- ----------
Five Percent Stockholders:
Charles River Ventures (1)..................................... 3,708,880    5.64%
Gotham Partners (2)............................................ 3,832,227    5.82

Directors and Named Executive Officers:
Gordon B. Hoffstein (3)........................................ 3,335,846    5.06
Stephen M. Joseph (4)..........................................   583,721      *
Samuel P. Gerace, Jr. (5)...................................... 2,631,195    3.99
Ted R. Dintersmith (6).........................................   195,607      *
W. Michael Humphreys (7).......................................   113,228      *
Jeffrey F. Rayport (8).........................................   160,693      *
Kathleen L. Biro (9)...........................................   114,999      *
W. Blair Heavey (10)...........................................   538,219      *
Steven D. Pike (11)............................................   255,447      *
Thomas A. Gerace (12).......................................... 3,067,901    4.66
All directors and executive officers as a group (9 persons)(13) 7,928,955   11.83%
</TABLE>
--------
*  Less than 1%

(1) Charles River Partnership VIII, L.P. has advised us that it owns 3,708,880
    shares. Charles River VIII GP, L.P. is the general partner of Charles River
    Partnership VIII, L.P., and Ted R. Dintersmith is a general partner of
    Charles River VIII GP, L.P. Charles River VIII GP, L.P. disclaims
    beneficial ownership of shares owned by Charles River Partnership VIII,
    L.P., in which it does not have a pecuniary interest. The address of
    Charles River VIII GP, L.P. is 1000 Winter Street, Suite 3300, Waltham, MA
    02451.

                                      38

<PAGE>

(2) Based on a Schedule 13G filed February 15, 2002, Gotham Partners, L.P. has
    sole voting power over 3,052,987 shares, Gotham Partners III, L.P. has sole
    voting power over 142,688 shares and Gotham International Advisors, L.L.C.
    has sole voting power over 636,552 shares. The address of Gotham Partners,
    L.P., Gotham Partners III, L.P. and Gotham International Advisors, L.L.C.
    is 110 East 42nd Street, 18th Floor, New York, NY 10017.

(3) Includes 155,207 shares issuable upon the exercise of options that are
    currently exercisable or exercisable within 60 days after March 8, 2002.
    Excludes 63,217 shares held by the Hoffstein Family Trust for the benefit
    of Mr. Hoffstein's children. Mr. Hoffstein disclaims any beneficial
    ownership of the shares held by the trust.

(4) Includes 143,227 shares issuable upon the exercise of options that are
    currently exercisable or exercisable within 60 days after March 8, 2002.

(5) Includes 155,207 shares issuable upon the exercise of options that are
    currently exercisable or exercisable within 60 days after March 8, 2002.

(6) Mr. Dintersmith, a member of the board of directors, is a general partner
    of Charles River VIII GP, L.P., the general partner of Charles River
    Partnership VIII, L.P. Excludes 3,708,880 shares owned by Charles River
    Partnership VIII, L.P. and 108,372 shares owned by the Dintersmith Family
    Limited Partnership. Mr. Dintersmith disclaims any beneficial ownership of
    the shares held by Charles River Partnership VIII, L.P. and the Dintersmith
    Family Limited Partnership except to the extent of his pecuniary interest
    therein includes 8,333 shares issuable upon the exercise of options that
    are currently exercisable within 60 days after March 8, 2002.

(7) Includes 8,333 shares issuable upon the exercise of options that are
    currently exercisable or exercisable within 60 days after March 8, 2002.

(8) Includes 34,895 shares issuable upon the exercise of options that are
    currently exercisable or exercisable within 60 days after March 8, 2002.

(9) Includes 114,999 shares issuable upon the exercise of options that are
    currently exercisable or exercisable within 60 days after March 8, 2002.

(10) Includes 358,306 shares issuable upon the exercise of options that are
     currently exercisable or exercisable within 60 days after March 8, 2002.

(11) Includes 254,060 shares issuable upon the exercise of options that are
     currently exercisable or exercisable within 60 days after March 8, 2002.

(12) Mr. Gerace left the Company in August 2001. He served as our Executive
     Vice President and Chief Marketing Officer until that time.

(13) Includes 1,232,567 shares issuable upon the exercise of options granted
     under the 1998 Stock Incentive Plan that are currently exercisable or
     exercisable within 60 days after March 8, 2002.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

    None.

                                      39

<PAGE>

                                    PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

Financial Statements and Schedules

    See Index to Financial Statements and Schedules, which appears on page F-1
hereof.

Reports on Form 8-K

    Form 8-K (Items 5 and 7) filed on March 12, 2002.
    Form 8-K (Items 5 and 7) filed on July 30, 2001.

Exhibits

    The exhibits listed on the Exhibit Index following the signature page
hereof are filed herewith in response to this Item.

                                      40

<PAGE>

                        BE FREE, INC. AND SUBSIDIARIES
                         INDEX TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
                                                                                                      Page
                                                                                                      No.
                                                                                                      ----
<S>                                                                                                   <C>
Financial Statements:
Report of Independent Accountants.................................................................... F-2
Consolidated Balance Sheets at December 31, 2001 and 2000............................................ F-3
Consolidated Statements of Operations for the years ended December 31, 2001, 2000 and 1999........... F-4
Consolidated Statements of Stockholders' Equity (Deficit) for the years ended December 31, 1999, 2000
  and 2001........................................................................................... F-5
Consolidated Statements of Cash Flows for the years ended December 31, 2001, 2000 and 1999........... F-6
Notes to Consolidated Financial Statements........................................................... F-7
</TABLE>

                               SCHEDULES OMITTED

    Schedules not filed herewith are omitted because of the absence of
conditions under which they are required or because the information called for
is shown in the financial statements or notes thereto.

                                      F-1

<PAGE>

                       Report of Independent Accountants

To the Board of Directors and Stockholders
of Be Free, Inc. and Subsidiaries:

    In our opinion, the consolidated financial statements listed in the
accompanying index present fairly, in all material respects, the financial
position of Be Free, Inc. and its subsidiaries at December 31, 2001 and 2000,
and the results of their operations and their cash flows for each of the three
years in the period ended December 31, 2001, in conformity with accounting
principles generally accepted in the United States of America. These financial
statements are the responsibility of the Company's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these statements in accordance with
auditing standards generally accepted in the United States of America, which
require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

/s/ PricewaterhouseCoopers LLP

Boston, Massachusetts
March 21, 2002

                                      F-2

<PAGE>

                        BE FREE, INC. AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
                     (In thousands, except per share data)

<TABLE>
<CAPTION>
                                                                            December 31, December 31,
                                                                                2001         2000
                                                                            ------------ ------------
<S>                                                                         <C>          <C>
                                  ASSETS
Current assets:
Cash and cash equivalents..................................................  $  59,030     $ 27,527
Marketable securities......................................................     74,116      122,333
Accounts receivable, net of allowances of $807 and $658, respectively......      2,736        3,903
Other current assets.......................................................      4,567        4,815
                                                                             ---------     --------
       Total current assets................................................    140,449      158,578
Marketable securities......................................................         --        4,021
Property and equipment, net................................................     11,962       17,443
Intangible assets, net.....................................................      2,960      119,217
Other assets...............................................................        725        1,116
                                                                             ---------     --------
Total assets...............................................................  $ 156,096     $300,375
                                                                             =========     ========
                   LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable...........................................................  $   1,291     $  1,937
Accrued expenses...........................................................      4,433        4,857
Deferred revenue...........................................................      1,210        1,250
Current portion of capital lease obligations...............................      2,110        2,593
                                                                             ---------     --------
       Total current liabilities...........................................      9,044       10,637
Capital lease obligations, net of current portion..........................        604        2,781
Other liabilities..........................................................        479           --
                                                                             ---------     --------
Total liabilities..........................................................     10,127       13,418
Commitments and contingencies (Note 9)
Stockholders' equity:
Common stock, $0.01 par value; 250,000 shares authorized; 67,029 and 66,021
  shares issued, respectively..............................................        670          660
Additional paid-in capital.................................................    380,660      379,932
Unearned compensation......................................................     (2,309)      (3,805)
Stockholders' notes receivable.............................................         --          (78)
Accumulated other comprehensive income.....................................        205          177
Accumulated deficit........................................................   (231,944)     (89,929)
                                                                             ---------     --------
                                                                               147,282      286,957
Treasury stock, at cost (1,159 shares at December 31, 2001)................     (1,313)          --
                                                                             ---------     --------
       Total stockholders' equity..........................................    145,969      286,957
                                                                             ---------     --------
Total liabilities and stockholders' equity.................................  $ 156,096     $300,375
                                                                             =========     ========
</TABLE>

   The accompanying notes are an integral part of the financial statements.

                                      F-3

<PAGE>

                        BE FREE, INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                     (In thousands, except per share data)

<TABLE>
<CAPTION>
                                                                             Year Ended December 31,
                                                                          -----------------------------
                                                                            2001       2000      1999
                                                                          ---------  --------  --------
<S>                                                                       <C>        <C>       <C>
Revenue.................................................................. $  23,414  $ 19,685  $  5,329
Operating expenses:
 Network costs...........................................................     5,297     3,627       845
 Sales and marketing (exclusive of equity related compensation of $751,
   $588 and $525, respectively)..........................................    15,515    17,873     9,329
 Client services (exclusive of equity related compensation of $130, $156,
   and $238, respectively)...............................................     6,589     6,918     3,474
 Development and engineering (exclusive of equity related compensation of
   $283, $197 and $146, respectively)....................................    10,466    10,540     4,767
 General and administrative (exclusive of equity related compensation of
   $1,122, $718 and $1,033, respectively)................................     8,567     6,374     2,824
 Equity related compensation.............................................     2,286     1,659     1,942
 Restructuring expenses..................................................     5,050        --        --
 Intangible amortization, merger related expenses and charge for
   impairment of assets..................................................   118,393    46,482        --
                                                                          ---------  --------  --------
       Total operating expenses..........................................   172,163    93,473    23,181
                                                                          ---------  --------  --------
       Operating loss....................................................  (148,749)  (73,788)  (17,852)
Interest income..........................................................     7,100     9,367     1,292
Interest expense.........................................................      (366)     (491)     (944)
                                                                          ---------  --------  --------
Net loss before extraordinary item.......................................  (142,015)  (64,912)  (17,504)
Extraordinary item--loss on early extinguishment of debt.................        --        --      (330)
                                                                          ---------  --------  --------
Net loss.................................................................  (142,015)  (64,912)  (17,834)
Accretion of preferred stock to redemption value.........................        --        --    (1,517)
                                                                          ---------  --------  --------
Net loss attributable to common stockholders............................. $(142,015) $(64,912) $(19,351)
                                                                          =========  ========  ========
Basic and diluted net loss per share:
Net loss per share attributable to common stockholders without
  extraordinary item..................................................... $   (2.22) $  (1.07) $  (1.00)
Extraordinary item per share.............................................        --        --     (0.02)
                                                                          ---------  --------  --------
Net loss per share attributable to common stockholders................... $   (2.22) $  (1.07) $  (1.02)
                                                                          =========  ========  ========
Shares used in computing basic and diluted net loss per share............    64,086    60,759    18,951
</TABLE>

   The accompanying notes are an integral part of the financial statements.


                                      F-4

<PAGE>

                        BE FREE, INC. AND SUBSIDIARIES
           CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
             for the years ended December 31, 1999, 2000 and 2001
                     (In thousands, except per share data)
<TABLE>
<CAPTION>

                                                                                       Additional              Stockholders'
                                                                             $0.01 Par  Paid-in    Un\earned       Notes
                                                                      Shares   Value    Capital   Compensation  Receivable
                                                                      ------ --------- ---------- ------------ -------------
<S>                                                                   <C>    <C>       <C>        <C>          <C>
Balance at December 31, 1998......................................... 19,500   $195     $  5,505    $(5,549)       $(780)
 Acquisition of treasury stock.......................................     --     --         (454)       437           74
 Acceleration of vesting of restricted stock.........................     --     --           77         --           --
 Issuance of restricted stock........................................     --     --           --        (98)         (52)
 Repayment of receivable from stockholder............................     --     --           --         --          550
 Unearned compensation related to option grants......................     --     --        2,674     (2,674)          --
 Amortization of unearned compensation...............................     --     --           --      1,882           --
 Series B Preferred Stock dividend...................................     --     --       (1,183)        --           --
 Accretion to redemption value of Series A and B Preferred Stock.....     --     --         (334)        --           --
 Issuance of Common Stock in initial public offering, net of offering
  costs.............................................................. 12,880    129       70,445         --           --
 Conversion of Series A and Series B Preferred Stock and warrants.... 23,796    238       35,550         --           --
 Stock issuance in connection with option and warrant exercises......     --     --          994         --           --
 Comprehensive loss:
   Net loss..........................................................     --     --           --         --           --
   Other comprehensive loss..........................................     --     --           --         --           --
                                                                      ------   ----     --------    -------        -----
 Comprehensive loss..................................................     --     --           --         --           --
                                                                      ------   ----     --------    -------        -----
Balance at December 31, 1999......................................... 56,176    562      113,274     (6,002)        (208)
 Amortization of unearned compensation...............................     --     --           --      1,939           --
 Elimination of unearned compensation for terminated employees.......     --     --         (258)       258           --
 Acceleration of vesting of restricted stock.........................     --     --           50         --           --
 Repayment of receivable from stockholder............................     --     --           --         --          130
 Issuance of Common Stock in secondary offering, net of offering
  costs..............................................................  4,047     40      104,665         --           --
 Issuance of Common Stock for acquisition of TriVida.................  2,913     29      160,930         --           --
 Acquisition of treasury stock.......................................     --     --           --         --           --
 Stock issuance in connection with Employee Stock Purchase Plan......    123      1          873         --           --
 Stock issuance in connection with option and warrant exercises......  2,762     28          398         --           --
 Comprehensive loss:
   Net loss..........................................................     --     --           --         --           --
   Other comprehensive income........................................     --     --           --         --           --
                                                                      ------   ----     --------    -------        -----
 Comprehensive loss..................................................     --     --           --         --           --
                                                                      ------   ----     --------    -------        -----
Balance at December 31, 2000......................................... 66,021    660      379,932     (3,805)         (78)
 Issuance of option grant to non-employee............................     --     --           52         --           --
 Stock issuance in connection with the Stock for Options Program.....    875      9        1,906     (1,906)          --
 Amortization of unearned compensation...............................     --     --           --      2,234           --
 Elimination of unearned compensation for terminated employees.......     --     --       (1,168)     1,168           --
 Repayment of receivable from stockholder............................     --     --           --         --           78
 Acquisition of treasury stock.......................................     --     --           --         --           --
 Stock issuance in connection with Employee Stock Purchase Plan......     --     --          123         --           --
 Stock issuance in connection with option exercises..................    133      1         (185)        --           --
 Comprehensive loss:
   Net loss..........................................................     --     --           --         --           --
   Other comprehensive income........................................     --     --           --         --           --
                                                                      ------   ----     --------    -------        -----
 Comprehensive loss..................................................     --     --           --         --           --
                                                                      ------   ----     --------    -------        -----
Balance at December 31, 2001......................................... 67,029   $670     $380,660    $(2,309)       $  --
                                                                      ======   ====     ========    =======        =====
</TABLE>
<TABLE>
<CAPTION>
                                                                       Accumulated                                   Total
                                                                          Other                                  Stockholders'
                                                                      Comprehensive Accumulated                     Equity
                                                                      Income (Loss)   Deficit   Shares   Value     (Deficit)
                                                                      ------------- ----------- ------  -------  -------------
<S>                                                                   <C>           <C>         <C>     <C>      <C>
Balance at December 31, 1998.........................................     $ --       $  (7,183) (1,685) $(1,685)   $  (9,497)
 Acquisition of treasury stock.......................................       --              --    (525)     (79)         (22)
 Acceleration of vesting of restricted stock.........................       --              --      --       --           77
 Issuance of restricted stock........................................       --              --     150      150           --
 Repayment of receivable from stockholder............................       --              --      --       --          550
 Unearned compensation related to option grants......................       --              --      --       --           --
 Amortization of unearned compensation...............................       --              --      --       --        1,882
 Series B Preferred Stock dividend...................................       --              --      --       --       (1,183)
 Accretion to redemption value of Series A and B Preferred Stock.....       --              --      --       --         (334)
 Issuance of Common Stock in initial public offering, net of offering
  costs..............................................................       --              --      --       --       70,574
 Conversion of Series A and Series B Preferred Stock and warrants....       --              --      --       --       35,788
 Stock issuance in connection with option and warrant exercises......       --              --   1,815    1,577        2,571
 Comprehensive loss:
   Net loss..........................................................       --         (17,834)     --       --      (17,834)
   Other comprehensive loss..........................................      (11)             --      --       --          (11)
                                                                          ----       ---------  ------  -------    ---------
 Comprehensive loss..................................................      (11)        (17,834)     --       --      (17,845)
                                                                          ----       ---------  ------  -------    ---------
Balance at December 31, 1999.........................................      (11)        (25,017)   (245)     (37)      82,561
 Amortization of unearned compensation...............................       --              --      --       --        1,939
 Elimination of unearned compensation for terminated employees.......       --              --      --       --           --
 Acceleration of vesting of restricted stock.........................       --              --      --       --           50
 Repayment of receivable from stockholder............................       --              --      --       --          130
 Issuance of Common Stock in secondary offering, net of offering
  costs..............................................................       --              --      --       --      104,705
 Issuance of Common Stock for acquisition of TriVida.................       --              --      --       --      160,959
 Acquisition of treasury stock.......................................       --              --    (126)     (18)         (18)
 Stock issuance in connection with Employee Stock Purchase Plan......       --              --      89       13          887
 Stock issuance in connection with option and warrant exercises......       --              --     282       42          468
 Comprehensive loss:
   Net loss..........................................................       --         (64,912)     --       --      (64,912)
   Other comprehensive income........................................      188              --      --       --          188
                                                                          ----       ---------  ------  -------    ---------
 Comprehensive loss..................................................      188         (64,912)     --       --      (64,724)
                                                                          ----       ---------  ------  -------    ---------
Balance at December 31, 2000.........................................      177         (89,929)     --       --      286,957
 Issuance of option grant to non-employee............................       --              --      --       --           52
 Stock issuance in connection with the Stock for Options Program.....       --              --      --       --            9
 Amortization of unearned compensation...............................       --              --      --       --        2,234
 Elimination of unearned compensation for terminated employees.......       --              --      --       --           --
 Repayment of receivable from stockholder............................       --              --      --       --           78
 Acquisition of treasury stock.......................................       --              --  (1,719)  (1,820)      (1,820)
 Stock issuance in connection with Employee Stock Purchase Plan......       --              --     213      142          265
 Stock issuance in connection with option exercises..................       --              --     347      365          181
 Comprehensive loss:
   Net loss..........................................................       --        (142,015)     --       --     (142,015)
   Other comprehensive income........................................       28              --      --       --           28
                                                                          ----       ---------  ------  -------    ---------
 Comprehensive loss..................................................       28        (142,015)     --       --     (141,987)
                                                                          ----       ---------  ------  -------    ---------
Balance at December 31, 2001.........................................     $205       $(231,944) (1,159) $(1,313)   $ 145,969
                                                                          ====       =========  ======  =======    =========
</TABLE>

   The accompanying notes are an integral part of the financial statements.

                                      F-5

<PAGE>

                        BE FREE, INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                (In thousands)

<TABLE>
<CAPTION>
                                                                                               Year Ended December 31,
                                                                                           ------------------------------
                                                                                             2001       2000       1999
                                                                                           ---------  ---------  --------
<S>                                                                                        <C>        <C>        <C>
Cash flows for operating activities:
  Net loss................................................................................ $(142,015) $ (64,912) $(17,834)
  Adjustments to reconcile net loss to net cash used in operating activities:
    Charge for impairment of intangible assets............................................   102,736         --        --
    Charge for write-off of long-lived assets.............................................     2,051         --        --
    Depreciation and amortization.........................................................    21,351     50,509     1,485
    Extraordinary loss on early extinguishment of debt....................................        --         --       330
    Loss on disposal of assets............................................................        40         --        --
    Non-cash restructuring costs..........................................................       779         --        --
    Equity related compensation...........................................................     2,286      1,659     1,942
    Provisions for doubtful accounts......................................................       149        561        82
    Changes in operating assets and liabilities net of the effects from the purchase of
     TriVida Corporation:
     Accounts receivable..................................................................     1,018     (3,562)     (856)
     Accounts payable.....................................................................      (646)    (1,809)      433
     Accrued expenses.....................................................................      (723)     1,119     2,353
     Deferred revenue.....................................................................       (40)       307       821
     Other assets.........................................................................       639     (2,751)   (1,734)
                                                                                           ---------  ---------  --------
Net cash used in operating activities.....................................................   (12,375)   (18,879)  (12,978)
                                                                                           ---------  ---------  --------
Cash flows for investing activities:
  Purchases of property and equipment.....................................................    (4,438)    (8,594)   (4,850)
  Cash paid for TriVida acquisition, net of cash acquired.................................        --     (3,528)       --
  Proceeds from the sale of marketable securities.........................................   213,548    163,793        --
  Purchases of marketable securities......................................................  (161,280)  (268,894)  (20,698)
                                                                                           ---------  ---------  --------
Net cash provided by (used in) investing activities.......................................    47,830   (117,223)  (25,548)
                                                                                           ---------  ---------  --------
Cash flows from financing activities:
  Proceeds from issuance of Series B Convertible Participating Preferred Stock, net of
   issuance costs.........................................................................        --         --    24,944
  Proceeds from issuance of common stock, net of offering costs...........................         9    104,705    70,574
  Proceeds from exercise of options and warrants..........................................       181        792     2,571
  Acquisition of treasury shares..........................................................    (1,820)        --        (5)
  Proceeds from employee stock purchase plan..............................................       265        887        --
  Proceeds from notes receivable from stockholders........................................        78        130       550
  Proceeds from sales/leaseback...........................................................        --         --       241
  Payments on long-term debt..............................................................    (2,660)    (1,829)   (5,700)
                                                                                           ---------  ---------  --------
Net cash provided by (used in) financing activities.......................................    (3,947)   104,685    93,175
Effect of exchange rate changes on cash...................................................        (5)       (32)       --
                                                                                           ---------  ---------  --------
Net increase (decrease) in cash and cash equivalents......................................    31,503    (31,449)   54,649
Cash and cash equivalents at beginning of year............................................    27,527     58,976     4,327
                                                                                           ---------  ---------  --------
Cash and cash equivalents at end of year.................................................. $  59,030  $  27,527  $ 58,976
                                                                                           =========  =========  ========
Cash paid during the year for interest.................................................... $     366  $     494  $    815
Non-cash investing and financing activities:
     Purchases of property and equipment under capital lease obligations and
      equipment financing................................................................. $      --  $   1,526  $  3,069
     Elimination of note receivable for restricted stock..................................        --         --        74
     Note receivable for Common Stock sold................................................        --         --        52

     The Company issued 2,913 shares of common stock valued at $131,631 to
      acquire all of the capital stock of TriVida Corporation. In conjunction with the
      acquisition, the fair value of the assets acquired and liabilities assumed were
      as follows:
     Fair value of assets acquired........................................................ $      --  $   3,648  $     --
     Liabilities assumed..................................................................        --      3,963        --
                                                                                           ---------  ---------  --------
          Net liabilities................................................................. $      --  $    (315) $     --
                                                                                           =========  =========  ========
</TABLE>

   The accompanying notes are an integral part of the financial statements.

                                      F-6

<PAGE>

                        BE FREE, INC. AND SUBSIDIARIES
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                (In thousands, except share and per share data)

1.  The Company and Basis of Presentation

    Be Free, Inc. (the "Company") is a provider of a marketing platform that
enables electronic commerce merchants and Internet portals to promote their
products and services on the Internet. The Company has a single operating
segment without an organizational structure dictated by product lines,
geography or customer type. Revenue has been primarily derived from the
Company's BFAST partner marketing services, which have been provided primarily
to domestic companies to date.

    The Company was incorporated on January 25, 1996 as "Freedom of
Information, Inc." On March 31, 1999, the Company changed its name to Be Free,
Inc.

    On February 29, 2000, the Company acquired TriVida Corporation (Note 4).
Under the terms of the agreement, all outstanding shares of TriVida capital
stock were exchanged in the aggregate for 2,912,996 shares of the Company's
Common Stock, net of an escrow claim of 20,280 shares, and the assumption of
options to acquire TriVida capital stock for an additional 566,592 shares of
the Company's Common Stock, which resulted in TriVida becoming a wholly-owned
subsidiary of the Company.

    On March 11, 2002, the Company announced its plans to merge with
ValueClick, Inc. (Note 16).

    The consolidated financial statements include the accounts of Be Free, Inc.
and its wholly-owned subsidiaries. All significant intercompany accounts and
transactions have been eliminated.

2. Summary of Significant Accounting Policies

Use of Estimates

    The preparation of these financial statements requires management to make
estimates and judgments that affect the reported amounts of assets,
liabilities, revenues and expenses, and related disclosure of contingent assets
and liabilities. On an on-going basis, management evaluates these estimates and
judgments, including those related to revenue recognition, allowance for
doubtful accounts, investments, intangible assets, restructuring, long-term
service contracts, contingencies and litigation. The estimates are based on
historical experience and on various other assumptions that are believed to be
reasonable under the circumstances, the results of which form the basis for
making judgments about the carrying values of assets and liabilities that are
not readily apparent from other sources. Actual results may differ from these
estimates under different assumptions and/or conditions.

Risks and Uncertainties

    The Company's future results of operations involve a number of risks and
uncertainties. Factors that could affect the Company's future operating results
and cause actual results to vary materially from expectations include, but are
not limited to, dependence on a limited number of suppliers, rapid

                                      F-7

<PAGE>

                        BE FREE, INC. AND SUBSIDIARIES

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

industry changes, competition, competitive pricing pressures, changes in
foreign laws and regulations, risks associated with breaches of our security
measures, ability to generate significant revenue to achieve profitability,
ability to sustain and manage growth, inability to attract and retain key
personnel, undetected problems in the Company's technologies, risks associated
with mergers and acquisitions, investments and alliances, enforcement of the
Company's intellectual property rights, litigation, changes in regulations, a
lessening demand or changes in the Internet advertising market and stock price
volatility.

    Financial instruments, which potentially subject the Company to
concentrations of credit risk, consist primarily of cash and cash equivalents,
marketable securities and accounts receivable. Substantially all of the
Company's cash, cash equivalents and marketable securities were invested in
money market accounts, commercial paper, certificates of deposit and U.S.
government obligations at two and seven institutions at December 31, 2001 and
2000, respectively. The Company believes these institutions to be of high
credit quality. The Company had no customers in 2001 or 2000 that exceeded 10%
of revenue. The Company had no customers that exceeded 10% of accounts
receivable at December 31, 2001. The Company had one customer that accounted
for 13% of accounts receivable at December 31, 2000.

Cash, Cash Equivalents and Marketable Securities

    The Company considers all highly liquid investments with remaining
maturities of three months or less at the time of acquisition to be cash
equivalents. Cash equivalents which consist of money market accounts,
commercial paper, certificates of deposits and U.S. government obligations are
stated at cost, which approximates market value. Cash equivalents totaled
$56,238 and $26,300 at December 31, 2001 and 2000, respectively.

    The Company's marketable securities consist of commercial paper, U.S.
government obligations and corporate bonds. At December 31, 2001 and 2000,
marketable debt and equity securities have been categorized as available for
sale under the provisions of Statement of Financial Accounting Standards (SFAS)
No. 115, "Accounting for Certain Investments in Debt and Equity Securities,"
and, as a result, are stated at fair value based generally on quoted market
prices.

    The amortized cost of debt securities is adjusted for amortization of
premiums and accretion of discounts to maturity or, in the case of asset-backed
securities, over the estimated life of the security. Such amortization and
accretion as well as interest are included in interest income or interest
expense. Net realized gains and losses have been immaterial to date. The cost
of securities sold is based on the specific identification method. Unrealized
holding gains and losses, net of applicable deferred taxes, are included as a
component of stockholders' equity in accumulated other comprehensive income
(loss) until realized.

    Management reviews its marketable securities at each balance sheet date to
assess the existence of any declines in the fair value of securities, which it
believes to be other than temporary or permanent.

                                      F-8

<PAGE>

                        BE FREE, INC. AND SUBSIDIARIES

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

If such declines are identified, a loss is recorded in the period that the
determination is made. No such losses have been recorded to date.

Property and Equipment

    Property and equipment are carried at cost less accumulated depreciation.
Depreciation is computed using the straight-line method over the estimated
useful lives of the assets, which are five years for furniture and office
equipment and three to five years for computer equipment and purchased
software. Leasehold improvements are depreciated over the shorter of related
lease terms or the estimated useful lives. The cost of maintenance and repairs
is charged to expense as incurred. When assets are retired or disposed of, the
assets and related accumulated depreciation are eliminated from accounts and
any related gains or losses are reflected in income or loss for the period.

    On January 1, 1999, the Company adopted American Institute of Certified
Public Accountants Statement of Position 98-1, "Accounting for the Costs of
Computer Software Developed or Obtained for Internal Use" (SOP 98-1).
Accordingly, the Company's policy is to capitalize costs associated with the
design and implementation of its operating systems, including internally
developed software. The Company amortizes these costs over the estimated useful
life of the software commencing with the date that the software is ready for
its intended use. The estimated useful life of the Company's internally
developed software is generally eighteen months. Development and engineering
costs, excluding costs required to be capitalized under SOP 98-1, are expensed
as incurred.

Long-Lived Assets

    The Company accounts for the impairment of long-lived assets in accordance
with the provisions of SFAS No. 121, "Accounting for the Impairment of
Long-Lived Assets and Long-Lived Assets to be Disposed of". SFAS No. 121
requires assets to be reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be
recoverable. For purposes of evaluating the recoverability of long-lived
assets, the recoverability test is performed using undiscounted net cash flows
estimated to be generated by those assets.

Revenue Recognition

    The Company derives its revenue from providing online marketing services to
customers. Customer contracts generally provide for a one-time integration or
initialization fee and monthly or quarterly service fees. For commerce
customers, the service fees are generally based on either a percentage of the
sales generated or on the number of transactions or orders generated by their
marketing partners, subject to minimum levels. For content customers, the
service fees are generally based on the volume of click-throughs generated by
their marketing partners, subject to minimum levels. The Company also offers
optional, enhanced customer services, such as outsourced program management,
marketing partner support and development, marketing partner application review
and marketing partner commission payment services for additional fees.

                                      F-9

<PAGE>

                        BE FREE, INC. AND SUBSIDIARIES

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)


    The Company recognizes revenue consistent with SEC Staff Accounting
Bulletin No. 101, "Revenue Recognition in Financial Statements" (SAB 101).
Under SAB 101, revenue is recognized when a contract has been signed, services
have been rendered, the related fee is fixed and determinable and collection of
the fee is reasonably assured. Integration and initialization fees are
recognized ratably over the expected life of the customer relationship. Service
revenue is recognized in the period earned based on the minimum level or, when
the transaction volume exceeds the minimum level for that period, based on
transaction volume. Revenue for enhanced customer services is recognized when
the related underlying activity is delivered.

    During the fourth quarter of 2001, the Company implemented a new automated
billing system that allows the Company to recognize all revenue in the quarter
that it was earned. Previously, the Company recognized transaction-based
revenue above minimum levels one month in arrears. The Company accounted for
this as a change in an accounting estimate. As a result of this change, the
Company recorded $499,000, one additional month of transaction-based revenue,
as revenue in the fourth quarter of 2001.

    On an on-going basis, the Company performs detailed analyses and monitors
individual customer accounts to evaluate collectibility. When a customer with a
collection risk is identified, the related revenue is deferred until collection
is reasonably assured. The Company did not incur any significant accounts
receivable write-offs during 2001, 2000 or 1999.

    The Company is generally required to discount the BFAST service fee by 5%
for any calendar day that Be Free's system response time does not meet the
contractual performance level for greater than 60 minutes during any calendar
day. Any discounts granted will be recorded as a reduction of revenue in the
period incurred. Discounts and credits issued to date have been immaterial.

Advertising Costs

    Advertising costs are expensed as incurred. Advertising expense of
approximately $31, $508 and $210 were charged to sales and marketing expense
for the years ended December 31, 2001, 2000 and 1999, respectively.

Income Taxes

    The Company provides for income taxes using the liability method whereby
deferred tax liabilities and assets are recognized based on temporary
differences between the amounts presented in the financial statements and the
tax bases of assets and liabilities using current statutory tax rates. A
valuation allowance is established against net deferred tax assets, if based on
the weighted available evidence, it is more likely than not that some or all of
the deferred tax assets will not be realized.

Accounting for Stock-Based Compensation

    SFAS No. 123, "Accounting for Stock-Based Compensation," encourages but
does not require companies to record compensation cost for stock-based employee
compensation at the fair value of

                                     F-10

<PAGE>

                        BE FREE, INC. AND SUBSIDIARIES

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

options issued. The Company has chosen to account for stock-based compensation
granted to employees using the intrinsic value method prescribed in Accounting
Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees,"
and related interpretations. Accordingly, compensation cost for stock options
granted to employees is measured as the excess, if any, of the fair value of
the Company's stock at the date of the grant over the amount that must be paid
to acquire the stock. The Company calculates the fair value of options granted
to employees in accordance with SFAS No. 123 for disclosure purposes only.
Stock-based compensation issued to non-employees is measured and recorded using
the fair value method prescribed in SFAS No. 123.

Foreign Currency Translation

    The functional currency of the Company's foreign subsidiaries is the local
currency. Accordingly, the assets and liabilities of the Company's foreign
subsidiaries are translated into U.S. dollars at exchange rates in effect at
the balance sheet date, except for property and equipment which is translated
at historical exchange rates. Income and expense items are translated at
average rates for the period. Foreign currency translation adjustments are
included in accumulated other comprehensive income as a separate component of
stockholders' equity (deficit). Foreign currency transaction gains and losses
are recorded in operating expenses and were not significant for the years ended
December 31, 2001, 2000 and 1999.

Accumulated Other Comprehensive Income (Loss)

    SFAS No. 130, "Reporting Comprehensive Income," establishes a standard for
reporting and displaying comprehensive income and its components within the
financial statements. As of December 31, 2001, accumulated other comprehensive
income, as reflected in the Consolidated Statements of Stockholders' Equity
(Deficit), consisted of $226 relating to net unrealized gains on marketable
securities and foreign currency translation losses of $21. As of December 31,
2000, accumulated other comprehensive income, as reflected in the Consolidated
Statements of Stockholders' Equity (Deficit), consisted of $206 relating to net
unrealized gains on marketable securities and foreign currency translation
losses of $18. As of December 31, 1999, accumulated other comprehensive loss
consisted of net unrealized losses on marketable securities.

Treasury Stock

    The Company accounts for the purchase of treasury stock using the cost
method. The Company has reissued treasury shares upon issuance of shares
related to grants of restricted stock, exercises of options and the Employee
Stock Purchase Plan. The difference between the cost of the treasury shares, on
a first-in, first-out basis, and the exercise price of the options or purchase
price of restricted stock is reflected in additional paid-in capital.

Reclassifications

    Certain prior year financial statement items have been reclassified to
conform to the current year's presentation.

                                     F-11

<PAGE>

                        BE FREE, INC. AND SUBSIDIARIES

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)


Recent Accounting Pronouncements

    In June 2001, the Financial Accounting Standards Board (FASB) issued SFAS
No. 143, "Accounting for Asset Retirement Obligations", which is effective
January 1, 2003. SFAS No. 143 addresses the financial accounting and reporting
for obligations and retirement costs related to the retirement of tangible
long-lived assets. The Company does not expect that the adoption of SFAS No.
143 will have a material impact on its financial statements.

    In July 2001, the FASB issued SFAS No. 141, "Business Combinations" and
SFAS No. 142, "Goodwill and Other Intangible Assets." SFAS No. 141 requires
that all business combinations be accounted for under the purchase method only
and that certain acquired intangible assets in a business combination be
recognized as assets apart from goodwill. SFAS No. 142 requires that ratable
amortization of goodwill be replaced with periodic tests of the impairment of
goodwill and that intangible assets other than goodwill be amortized over their
useful lives. SFAS No. 141 is effective for all business combinations initiated
after June 30, 2001. The provisions of SFAS No. 142 will be effective for
fiscal years beginning after December 15, 2001, and will thus be adopted by the
Company, as required, in the year ending December 31, 2002. The impact of SFAS
No. 141 and SFAS No. 142 on the Company's financial statements has not yet been
determined.

    In August 2001, the FASB issued SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets", which is effective January 1,
2002. SFAS No. 144 supersedes SFAS No. 121, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to Be Disposed Of", and the
accounting and reporting provisions relating to the disposal of a segment of a
business of Accounting Principles Board Opinion No. 30. The Company does not
expect that the adoption of SFAS No. 144 will have a material impact on its
financial statements.

3. Restructuring Charges

    Throughout 2001, in response to a reduction in our customer base and longer
than anticipated sales cycles the Company executed plans to restructure several
areas of the Company. The restructuring plans included the termination of a
total of 118 employees, which represented approximately 41% of the total
workforce, the consolidation of certain office space and a non-cash write-off
of excess and idle equipment. As a result, the Company recorded restructuring
charges totaling $5,050 for the year ended December 31, 2001.

    The restructuring charge comprises cash charges totaling $2,999, including
severance costs for the termination of employees during the year of $1,802, a
charge for future lease payments for unutilized office space of $852, and other
restructuring costs of $345. At December 31, 2001, $2,102 of this charge had
been paid. The Company expects the remaining $897, principally related to
future lease payments for unutilized office space, to be paid over the next
three years. The Company also recognized a non-cash impairment charge
associated with excess and idle equipment of $1,953 and leasehold improvements
on unutilized office space of $98.

                                     F-12

<PAGE>

                        BE FREE, INC. AND SUBSIDIARIES

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)


    The following table summarizes the restructuring related activity during
2001:

<TABLE>
         <S>                                                  <C>
         Restructuring charges:
         Employee severance, benefits and related costs...... $ 1,802
         Excess and idle equipment...........................   1,953
         Unutilized office space.............................     852
         Leasehold improvements on unutilized office space...      98
         Other restructuring costs...........................     345
                                                              -------
            Total restructuring costs........................   5,050
         Cash payments made during 2001......................  (2,102)
         Non-cash impairment charges.........................  (2,051)
                                                              -------
            Accrued restructuring costs at December 31, 2001. $   897
                                                              =======
</TABLE>

4. Acquisition

    On February 29, 2000, the Company acquired TriVida. TriVida provides
personalization services to online merchants and content sites. These
personalization services are designed to predict the buying behavior of a
unique but anonymous user based upon the past browsing and buying behavior of
that user as well as other anonymous users. In connection with the transaction,
the Company issued Common Stock with an approximate value of $160,930. The
acquisition has been accounted for under the purchase method of accounting. The
total purchase price of $164,745 was allocated to goodwill of $110,060 and
other intangibles, including patents, developed technology and workforce, of
$55,000 and net liabilities of $315. These acquired assets have been recorded
as intangible assets within the Consolidated Balance Sheet, and are being
amortized on a straight-line basis over three years. For the year ended
December 31, 2000, the Company recorded a non-recurring charge to operations
for acquisition-related costs of $639, which primarily related to employee
severance.

    Based on management's assessment at March 31, 2001, the Company decided
that the technology obtained through the acquisition of TriVida will not be
integrated with the BFAST Partner Marketing technology as originally intended
due to the deterioration of the Internet retail market, customer feedback and
other business factors. As a result of this decision and a review of the other
factors, the Company concluded that an impairment assessment was required for
the long-lived assets of TriVida.

    The Company grouped all long-lived assets for TriVida, including goodwill
and other intangible assets, and estimated the future discounted cash flows
related to these long-lived assets. The discount rate used was based on the
risks involved. As a result of this analysis, the Company recorded an
impairment charge in 2001 totaling $102,736 which represents the excess of the
carrying amount of the TriVida assets over the discounted cash flows. The
remaining carrying amount of the assets will be amortized over their remaining
useful lives.

    At December 31, 2001, the Company had $2,960 in intangible assets, net of
accumulated amortization of $61,502 for the completed technology relating to
this acquisition. The Company recorded $15,659, $45,843 and $0 of amortization
expense relating to intangible assets and goodwill for the years ended December
31, 2001, 2000 and 1999, respectively.

                                     F-13

<PAGE>

                        BE FREE, INC. AND SUBSIDIARIES

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)


    The following unaudited pro forma consolidated results are presented as if
the TriVida acquisition had occurred on January 1, 2000 and 1999, respectively.
Based on an estimated useful life of three years for the intangible assets, the
unaudited proforma consolidated results include an adjustment of approximately
$9,169 and $55,020 for amortization expense for the twelve months ended
December 31, 2000 and 1999 respectively, and $639 in nonrecurring acquisition
related expense for the year ended December 31, 1999.

<TABLE>
<CAPTION>
                                                Year ended December 31,
                                                ----------------------
                                                   2000         1999
                                                 --------     --------
           <S>                                  <C>          <C>
           Revenue............................. $ 19,685     $  5,329
           Net loss............................  (77,381)     (81,225)
           Basic and diluted net loss per share    (1.26)       (3.73)
</TABLE>

    The unaudited consolidated pro forma information is not necessarily
indicative of the combined results that would have occurred had the purchase
been made at the beginning of the periods presented or the future results of
the combined operations.

5. Marketable Securities

    The following is a summary of marketable securities at December 31, 2001:

<TABLE>
<CAPTION>
                                             Gross      Gross
                                 Amortized Unrealized Unrealized
                                   Cost      Gains      Losses   Fair Value
                                 --------- ---------- ---------- ----------
    <S>                          <C>       <C>        <C>        <C>
    Current:
     Certificates of deposit....  $ 2,900     $ 27       $--      $ 2,927
     Commercial paper...........    5,562       --        --        5,562
     U.S. government obligations   35,377       31        --       35,408
     Treasury...................   11,269       36        --       11,305
     Corporate bonds............   18,782      132        --       18,914
                                  -------     ----       ---      -------
    Total.......................  $73,890     $226       $--      $74,116
                                  =======     ====       ===      =======
</TABLE>

    The following is a summary of marketable securities at December 31, 2000:

<TABLE>
<CAPTION>
                                              Gross      Gross
                                  Amortized Unrealized Unrealized
                                    Cost      Gains      Losses   Fair Value
                                  --------- ---------- ---------- ----------
    <S>                           <C>       <C>        <C>        <C>
    Current:
     Certificates of deposit..... $  3,198     $ 13       $--      $  3,211
     Commercial paper............   58,248        3        --        58,251
     U.S. government obligations.   15,761        6        --        15,767
     Corporate bonds.............   44,984      120        --        45,104
                                  --------     ----       ---      --------
     Total current...............  122,191      142        --       122,333
    Non-current:.................
     Corporate bonds.............    3,968       53        --         4,021
                                  --------     ----       ---      --------
    Total........................ $126,159     $195       $--      $126,354
                                  ========     ====       ===      ========
</TABLE>

                                     F-14

<PAGE>

                        BE FREE, INC. AND SUBSIDIARIES

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)


    All securities classified as current have contractual maturities less than
one year. All securities classified as non-current have contractual maturities
greater than one year, but less than two years. Expected maturities may differ
from contractual maturities because borrowers may have the right to call or
prepay obligations with or without call or prepayment penalties. Gross realized
gains and losses have been immaterial to date.

6. Property and Equipment

    Property and equipment consist of the following:

<TABLE>
<CAPTION>
                                                             Amounts under capital
                                                              Lease arrangements
                                                             --------------------
                                             December 31,        December 31,
                                          -----------------  --------------------
                                            2001     2000      2001        2000
                                          --------  -------   -------     -------
<S>                                       <C>       <C>      <C>         <C>
Furniture and office equipment........... $  1,187  $ 1,251  $   424     $   419
Computer equipment and purchased software   19,566   20,180    5,657       5,667
Internally-developed software............    2,438    1,674       --          --
Leasehold improvements...................      601      615      109         109
Assets held for sale.....................      138       --       --          --
                                          --------  -------   -------     -------
 Total property and equipment............   23,930   23,720    6,190       6,195
Accumulated depreciation and amortization  (11,968)  (6,277)  (4,126)     (2,160)
                                          --------  -------   -------     -------
Property and equipment, net.............. $ 11,962  $17,443  $ 2,064     $ 4,035
                                          ========  =======   =======     =======
</TABLE>

    Depreciation and amortization expense totaled $5,691, $4,808 and $1,128 for
the years ended December 31, 2001, 2000 and 1999, respectively.
Internally-developed software totaled $1,249, net of accumulated amortization
of $1,189, and $1,226, net of accumulated amortization of $448, at December 31,
2001 and 2000, respectively.

7. Accrued Expenses

    Accrued expenses include the following:

<TABLE>
<CAPTION>
                                                        2001   2000
                                                       ------ ------
            <S>                                        <C>    <C>
            Salaries and benefits..................... $1,139 $1,604
            Professional fees.........................    850    922
            Accrued restructuring costs...............    418     --
            Accrued taxes.............................    353    183
            Merchants' marketing partners' commissions    807    799
            Other.....................................    866  1,349
                                                       ------ ------
             Accrued expenses......................... $4,433 $4,857
                                                       ====== ======
</TABLE>

                                     F-15

<PAGE>

                        BE FREE, INC. AND SUBSIDIARIES

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)


8. Capital Lease Obligations and Long-Term Debt

    As of December 31, 2001 and 2000, the Company had obligations under capital
leases and equipment financing of $2,714 and $5,374, respectively. During the
years ended December 31, 2001 and 2000, the Company entered into various
equipment, software and support financing agreements totaling approximately $0
and $2,457, respectively. These agreements are collateralized by the asset
purchases (Note 6) made under the capital lease agreements. As of December 31,
2001, no amounts were available for borrowing under these agreements.

    The weighted average interest rate of outstanding capital lease obligations
debt at December 31, 2001 and 2000 was 10.2% and 10.6%.

    Future payments on capital lease obligations as of December 31, 2001 are as
follows:

<TABLE>
<CAPTION>
                Year ended December 31,
                -----------------------
                <S>                                    <C>
                2002.................................. $ 2,236
                2003..................................     621
                                                       -------
                Total payments........................   2,857
                Less amounts representing interest....    (143)
                                                       -------
                Present value of net payments.........   2,714
                Less current portion..................  (2,110)
                                                       -------
                Long-term debt, net of current portion $   604
                                                       =======
</TABLE>

    On September 29, 1998, the Company entered into a subordinated debt
agreement totaling $5,000 which incurred interest at 12% per annum. The Company
borrowed the full amount available under this agreement on October 23, 1998.
This debt was paid in full in December 1999. In connection with the
subordinated debt financing, the Company also granted warrants to purchase
700,000 shares of the Company's Series A Convertible Participating Preferred
Stock at $1.00 per share. Upon the closing of the Company's initial public
offering, the warrants converted into Common Stock warrants to purchase 700,000
shares of Common Stock at $1.00 per share. The fair value of the warrants,
estimated to be approximately $540 at issuance, was recorded as a discount on
the carrying value of the debt and amortized to interest expense over the term
of the debt. The value of the warrants was estimated assuming a weighted
average risk free interest rate of 4.51%, an expected life from date of grant
of four years, a volatility of 100% and no expected dividends. The amount of
interest expense recognized for the year ended December 31, 1999 totaled $180.
The remaining deferred financing cost of $330 was expensed as an extraordinary
loss upon the early retirement of the debt. The warrants were fully exercised
in August 2000.

9. Commitments and Contingencies

    The Company leases facilities and computer equipment under operating lease
agreements that expire on various dates through November 2008. The Company pays
all insurance and pro-rated portions of certain operating expenses for certain
leases. Rent expense was $4,772, $3,394 and $1,143 for the years ended December
31, 2001, 2000 and 1999, respectively.

                                     F-16

<PAGE>

                        BE FREE, INC. AND SUBSIDIARIES

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)


    The future minimum lease payments at December 31, 2001 are as follows:

<TABLE>
<CAPTION>
                                                  Operating
                     Year ended December 31,       Leases
                     -----------------------      ---------
                     <S>                          <C>
                     2002........................  $2,775
                     2003........................   1,914
                     2004........................   1,409
                     2005........................     516
                     2006........................     374
                     2007 and thereafter.........     717
                                                   ------
                     Total minimum lease payments  $7,705
                                                   ======
</TABLE>

    Be Free is subject to legal proceedings and claims that arise in the
ordinary course of business. Be Free does not believe that the outcome of any
of those matters will have a material adverse effect on Be Free's consolidated
financial position, operating results or cash flows.

    On November 30, 2001, a class action lawsuit was filed in the Southern
District of New York naming as defendants the Company, the managing
underwriters of the Company's initial public offering (the "IPO"), and the
following officers and former officers of the Company: Gordon B. Hoffstein,
Samuel P. Gerace, Jr., Thomas A. Gerace and Stephen M. Joseph. The complaint is
captioned Saul Kassin v. Be Free, Inc., et al., 01-CV-10827. The complaint
alleges, in part, that the Company's IPO registration statement and final
prospectus contained material misrepresentations and/or omissions related, in
part, to excessive and undisclosed commissions allegedly received by the
underwriters from investors to whom the underwriters allegedly allocated shares
of the IPO. The Company has not yet formally responded to the allegations. The
Company believes that the claims against the Company and the individual
directors and officers named in the lawsuit are without merit and intends to
defend such claims vigorously. As this case is at an early stage, it is not
possible to express an opinion as to its final outcome or estimate the amount
of a probable loss, if any, that might result.
10. Capital Structure

    The authorized capital stock of the Company consists of 250,000,000 shares
of voting common stock ("Common Stock") authorized for issuance with a par
value of $0.01 and 10,000,000 shares of Preferred Stock with a par value of
$0.01, of which 250,000 are designated to Series A Junior Participating
Preferred Stock.

Common Stock

    On August 28, 1998, certain controlling stockholders of the Company
transferred 2,145,000 shares of Common Stock to employees in consideration of
past performance and as an incentive for continuing employment with the
Company. The stock was transferred subject to certain vesting restrictions and
for no cash consideration. The fair value of these restricted stock awards at
the date of transfer totaled $2,145, which the Company is recognizing as
compensation expense over the defined

                                     F-17

<PAGE>

                        BE FREE, INC. AND SUBSIDIARIES

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

vesting period. The vesting for the transferred shares occurs over four years
commencing with the recipient's date of hire. The remaining unearned
compensation will vest at various dates through 2002. Upon the transfer of
these shares, the Company recorded a charge of $1,826 representing fully vested
shares. In addition, the Company recorded unearned compensation related to
unvested shares totaling $319. The Company recorded amortization of the
unearned compensation totaling, $60, $30 and $13 for the years ended December
31, 1999, 2000 and 2001, respectively relating to these shares.

    On October 13, 1999, the Company's Board of Directors and stockholders
authorized a 1-for-2 Common Stock split. Stockholder's equity (deficit) has
been restated for all periods presented to give retroactive recognition to the
reverse split in prior periods by reclassifying from Common Stock to additional
paid-in capital the par value of the shares removed by the split. In addition,
all references in the consolidated financial statements to the number of Common
Stock shares and per share amounts have been adjusted to reflect this reverse
split.

    On November 3, 1999, the Company sold 12,880,000 shares of Common Stock in
its initial public offering for cash proceeds of $70,574, net of offering costs
of $6,706.

    On February 15, 2000, the Company's Board of Directors approved a
two-for-one stock split of Common Stock in the form of a stock dividend. The
stock dividend was paid on March 8, 2000. All references in the consolidated
financial statements to the number of Common Stock shares and per share amounts
have been adjusted to reflect this stock split.

    On March 28, 2000, the Company sold 4,046,608 shares of its Common Stock in
a public offering for cash proceeds of $104,705, net of offering costs of
$6,577.

Stockholders' Rights Plan

    On July 25, 2001, the Company announced that its Board of Directors had
adopted a Shareholder Rights Plan (the "Plan"). All Company shareholders of
record as of August 8, 2001, received one right to purchase shares of a new
series of Preferred Stock ("Rights") for each share of Common Stock owned. The
Rights are not being distributed in response to any current effort to acquire
control of the Company, but rather to safeguard against tender offers,
squeeze-out mergers and other takeover tactics that limit the ability of all
shareholders to realize the long-term value of their investment in the Company.
The Rights do not prevent a takeover, but are an attempt to encourage anyone
seeking to acquire the Company to negotiate with the Board of Directors prior
to attempting one. Initially, each Right will automatically trade with the
underlying Common Stock and will not be exercisable. Subject to limited
exceptions, the Rights will become exercisable if a person or entity commences
a tender offer for 15 percent or more of outstanding Be Free Common Stock. Each
Right may then be exercised for $12 in exchange for one one-thousandth of a
share of the newly created Series A Junior Participating Preferred Stock of the
Company.

    The Rights may also become exercisable if a person or entity acquires 15
percent or more of outstanding Be Free Common Stock. Each Right, other than
those owned by the acquiring entity,

                                     F-18

<PAGE>

                        BE FREE, INC. AND SUBSIDIARIES

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

would permit the holder to purchase shares of Be Free's Common Stock having a
market value of two times the $12 exercise price of the Right. Similarly, if Be
Free is involved in a merger or other transaction with another company in which
Be Free is not the surviving corporation, or transfers more than 50 percent of
its assets to another company, each Right, other than those owned by the
acquiring entity, would permit the holder to purchase shares of the acquiring
company's common stock having a market value of two times the $12 exercise
price of the Right. Be Free's Board of Directors may redeem the Rights for
$0.001 per Right at any time up to ten business days after a person or entity
has acquired 15 percent or more of the outstanding Common Stock. Unless the
Rights are exercised or redeemed earlier, they will expire on July 24, 2011.

    In connection with the execution of the merger agreement (Note 16), the
Company amended the Plan to provide, among other things, that ValueClick, Inc.
would not be considered to be an "acquiring person" thereunder by reason of any
transaction contemplated by the merger agreement.

11.  Stock Options and Restricted Stock Awards

    On November 19, 1998, the Company adopted its 1998 Stock Incentive Plan
(the "Option Plan"). The Option Plan is administered by the Company's Board of
Directors, and allows for the granting of awards in the form of incentive stock
options to employees and nonqualified options and restricted stock to officers,
employees, consultants, directors and advisors. The exercise prices for awards
and options granted were determined by the Board of Directors of the Company to
be equal to the fair value of the Common Stock on the date of grant. In
reaching this determination at the time of each grant, prior to the Company's
initial public offering, the Company's Board of Directors considered a broad
range of factors including the illiquid nature of an investment in the Common
Stock, the Company's historical financial performance and financial position
and the Company's future prospects and opportunity for liquidity events.

    On March 31, 2000, the Company registered TriVida Corporation's 1998 Equity
Incentive Plan, which was assumed by Be Free, Inc. in connection with its
acquisition of TriVida on February 29, 2000. The Company registered 566,592
shares of Common Stock to cover all unexercised options granted under this plan.

    Options and restricted stock awards normally vest over 48 months.
Twenty-five percent of each award normally vests after 12 months from the date
of grant, and an additional 2.0833% vests each month for the next 36 months. In
the event of a change of control of the Company (as defined by the Option
Plan), the vesting for each option and restricted stock award will
automatically be accelerated with respect to 25% of the shares subject to such
options or restricted stock awards. In the event that a participant in the Plan
is terminated within two years from the anniversary of the change of control
event, each option and restricted stock award will vest in full. Stock options
may not be exercised after ten years from the date of grant.

    On May 25, 2000, stockholders approved an amendment to the Option Plan to
provide for automatic annual increases in the number of shares authorized for
issuance. As of December 31, 2001, the Option Plan allowed for the Company to
grant up to 16,035,980 options for common shares and restricted stock.

                                     F-19

<PAGE>

                        BE FREE, INC. AND SUBSIDIARIES

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)


    During the year ended December 31, 1999, the Company issued 150,000 shares
of restricted stock for $0.35 per share in exchange for a note receivable
totaling $53. The weighted-average grant-date fair value of these shares of
restricted stock was $1.00 per share.

    During the year ended December 31, 1999, the Company recorded unearned
compensation for restricted stock and options granted to employees below fair
value of $2,772. The Company is recognizing the compensation expense over the
vesting period. The Company recorded equity compensation expense including
amortization expense relating to unearned compensation of $1,705, $1,939 and
$1,822 for the years ended December 31, 2001, 2000 and 1999, respectively.

    On April 30, 1999, the Company also accelerated the vesting with respect to
77,103 shares of restricted stock held by a former employee. The Company has
recorded a charge of $77 in connection with this acceleration.

    On January 1, 2001, the Company issued 875,306 shares of restricted stock
to employees who had previously requested to participate in a Stock-for-Options
benefit program (the "Program"). Under the provisions of the Program,
participating employees exchanged two stock options issued under the Option
Plan for one share of restricted stock with a purchase price of $0.01 per
share. The first 25% of the restricted stock purchased vests 15 months from the
original stock option grant date. An additional 25% vests each year after the
first vest date, for a period of three years. In connection with the Program,
the Company recorded unearned compensation for restricted stock granted to
employees below fair market value of $1,906. The Company will recognize this
compensation expense over the vesting period of the restricted stock which is
based on the remaining vesting period of the cancelled options. During 2001,
the balance of the unearned compensation was reduced by $1,168 associated with
the departure of employees with unvested shares of restricted stock that were
repurchased by the Company.

    The following table summarizes option activity under the Option Plan:

<TABLE>
<CAPTION>
                                                          Weighted
                                                          Average
                                              Number of   Exercise
                                               Shares      Price
                                              ----------  --------
             <S>                              <C>         <C>
             Outstanding at December 31, 1998  1,384,858   $ 0.15
             Granted.........................  2,310,442     2.71
             Exercised.......................   (164,638)    0.59
             Cancelled.......................    (44,810)    1.74
                                              ----------
             Outstanding at December 31, 1999  3,485,852     1.80
             Assumed in acquisition..........    566,592    15.56
             Granted.........................  4,276,558    12.85
             Exercised.......................   (665,722)    0.70
             Cancelled.......................   (792,280)   13.46
                                              ----------
             Outstanding at December 31, 2000  6,871,000     7.33
             Granted.........................  4,339,823    1.524
             Exercised.......................   (476,404)    0.38
             Cancelled....................... (3,733,777)    8.96
                                              ----------
             Outstanding at December 31, 2001  7,000,642   $ 3.89
                                              ==========
</TABLE>

                                     F-20

<PAGE>

                        BE FREE, INC. AND SUBSIDIARIES

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)


    The following table summarizes information about stock options outstanding
at December 31, 2001:

<TABLE>
<CAPTION>
                             Shares Outstanding        Shares Exercisable
                             ------------------        ------------------
                                            Weighted
                                 Weighted   Average              Weighted
                                 Average   Remaining             Average
                                 Exercise Contractual            Exercise
       Exercise Price   Shares    Price   Life (Years)  Shares    Price
       --------------   ------    -----   ------------  ------    -----
       <S>             <C>       <C>      <C>          <C>       <C>
         $0.15-$0.35     707,312  $ 0.18      6.8        484,228  $ 0.18
         $0.54-$1.18   1,062,024  $ 0.97      8.5        268,714  $ 0.86
         $1.24-$2.38   3,212,213  $ 1.56      9.3        157,241  $ 1.53
         $3.44-$5.40     754,494  $ 4.33      8.2        319,899  $ 4.35
        $9.06-$13.50   1,051,288  $10.09      8.4        410,374  $10.20
       $14.06-$30.56      12,308  $22.88      8.1          6,701  $22.08
       $34.00-$49.75     201,003  $34.22      8.0         96,371  $34.22
                       ---------                       ---------
        $0.15-$49.75   7,000,642  $ 3.89      8.6      1,743,528  $ 5.49

                       =========                       =========
</TABLE>

    The weighted average exercise price of options exercisable at December 31,
2001 and 2000 was $5.49 and $2.01, respectively. Options exercisable as of
December 31, 2001, 2000 and 1999 totaled 1,743,528, 1,017,994 and 244,506,
respectively.

    Had compensation cost for the Company's 2001, 2000 and 1999 stock option
grants been calculated consistent with SFAS No. 123, the Company's net loss and
net loss per share would have been increased to the pro forma amounts indicated
below:

<TABLE>
<CAPTION>
                                                          December 31,
                                                 -----------------------------
                                                    2001      2000      1999
                                                 ---------- --------- ---------
 Net loss as reported........................... $(142,015) $(64,912) $(19,351)
 <S>                                             <C>        <C>       <C>
 Net loss per share as reported.................     (2.22)    (1.07)    (1.02)
 Pro forma net loss under SFAS No. 123..........  (143,120)  (72,104)  (19,429)
 Pro forma net loss per share under SFAS No. 123     (2.23)    (1.19)    (1.03)
</TABLE>

    The following table presents the significant assumptions used to estimate
the fair values of the options:

<TABLE>
<CAPTION>
                                                      December 31,
                                               -------------------------
                                                2001     2000     1999
                                               -------  -------  -------
      <S>                                      <C>      <C>      <C>
      Weighted-average risk free interest rate    4.44%    6.43%    5.53%
      Expected life from the date of grant.... 4 years  5 years  5 years
      Weighted-average volatility.............    93.5%     100%      29%
      Expected dividends......................    None     None     None
</TABLE>

    The weighted-average fair value of options on the date of grant or acquired
for the options granted or acquired in 2000 and 1999 with an exercise price
less than grant date stock fair value was $7.78 and $1.54, respectively. All
options granted in 2001 and 2000 had an exercise price equal to the grant date
stock fair value. The weighted average fair value of options with an exercise
price equal to grant date stock fair value in 2001, 2000 and 1999 were $1.13,
$9.98 and $5.27, respectively.

                                     F-21

<PAGE>

                        BE FREE, INC. AND SUBSIDIARIES

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)


    The pro forma effects of applying SFAS No. 123 are not indicative of future
impacts. Additional grants in future years are anticipated.

12. Net Loss Per Share

    Basic net loss per share is computed using the weighted average number of
common shares outstanding during the year. Diluted net loss per share is
computed using the weighted average number of common shares outstanding during
the year, plus the effect of any dilutive potential common shares. Dilutive
potential common shares consist of stock options, preferred stock rights (Note
10), unvested shares of restricted stock and warrants. Potential common shares
were excluded from the calculation of net loss per share for the periods
presented since their inclusion would be antidilutive.

    Potential common shares excluded from the calculation of diluted loss per
share were as follows:

<TABLE>
<CAPTION>
                                                       December 31,
                                               -----------------------------
                                                 2001      2000      1999
                                               --------- --------- ---------
   <S>                                         <C>       <C>       <C>
   Options to purchase shares of Common Stock. 7,000,642 6,855,764 3,485,852
   Unvested shares of restricted stock........ 1,334,172 2,209,437 3,500,678
   Warrants to purchase shares of Common Stock        --        -- 2,548,000
</TABLE>

13. Income Taxes

    Deferred income taxes include the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for income tax purposes.

    The components of the Company's deferred tax assets are as follows:
<TABLE>
<CAPTION>
                                                December 31,
                                             ------------------
                                               2001      2000
                                             --------  --------
                <S>                          <C>       <C>
                Startup costs............... $     34  $    102
                Other temporary differences.       17       725
                Credits.....................       66        45
                Net operating losses........   29,073    20,200
                                             --------  --------
                Total net deferred tax asset   29,190    21,072
                Valuation allowance.........  (29,190)  (21,072)
                                             --------  --------
                Net deferred taxes.......... $     --  $     --
                                             ========  ========
</TABLE>

    A reconciliation of the United States federal statutory corporate rate to
the Company's effective tax rate is as follows:

<TABLE>
<CAPTION>
                                             Year ended December 31,
                                             ---------------------
                                             2001    2000    1999
                                             -----   -----   -----
            <S>                              <C>     <C>     <C>
            Statutory federal corporate rate (34.0)% (34.0)% (34.0)%
            Nondeductible goodwill..........  28.8    24.0      --
            Other...........................  (0.4)   (0.8)   (4.0)
            Increase in valuation allowance.   5.6    10.8    38.0
                                             -----   -----   -----
            Effective tax rate..............    --%     --%     --%
                                             =====   =====   =====
</TABLE>

                                     F-22

<PAGE>

                        BE FREE, INC. AND SUBSIDIARIES

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)


    A valuation allowance is established if it is more likely than not that all
or a portion of the deferred tax asset will not be realized. Accordingly, a
valuation allowance has been established for the full amount of the deferred
tax asset due to the uncertainty of realization.

    The Company had net operating loss carryforwards of approximately $72,196,
$50,161 and $19,931 at December 31, 2001, 2000 and 1999, respectively. The
federal net operating loss carryforwards begin to expire in 2010.

    At December 31, 2001 and 2000, approximately $1,569 and $1,200 of the net
operating loss carryforwards available for federal income tax purposes relate
to exercises of non-qualified stock options and disqualifying disposition of
incentive stock options, the benefit from which, if realized, will be credited
to additional paid-in capital.

    Under the provisions of Section 382 of the Internal Revenue Code, certain
substantial changes in the Company's ownership may have limited, or may limit
in the future, the amount of net operating loss carryforwards which could be
utilized annually to offset future taxable income and income tax liabilities.
The amount of any annual limitation is determined based upon the Company's
value prior to an ownership change.

14. Employee Benefit Plans

Defined Contribution Plan

    In January 1999, the Company established a savings plan for its employees
which it designed to be qualified under Section 401(k) of the Internal Revenue
Code. Eligible employees are permitted to contribute to the 401(k) plan through
payroll deduction within statutory and plan limits. The Company may make
contributions to the 401(k) plan in its discretion. The Company made
contributions totaling $133 to this savings plan in 2001. No Company
contributions were made to this savings plan in the years ended December 31,
2000 and 1999.

Employee Stock Purchase Plan

    In October 1999, the Company established a qualified Employee Stock
Purchase Plan, the terms of which allow for qualified employees to participate
in the purchase of designated shares of the Company's Common Stock at a price
equal to the lower of 85% of the closing price at the beginning or end of each
semi-annual stock purchase period. The Company has designated a maximum of
425,000 shares for this plan. As of December 31, 1999, 2000 and 2001, the
Company has issued 0, 211,714 and 213,286 shares under this plan, respectively.

15. Related Party Transactions

    The Company had amounts due from related parties totaling $0 and $97 at
December 31, 2001 and 2000, respectively. Amounts due from related parties at
December 31, 2000 was comprised of $78 related to notes receivable from
stockholders for restricted stock and $19 related to employee advances.

                                     F-23

<PAGE>

                        BE FREE, INC. AND SUBSIDIARIES

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)


16. Subsequent Events

    On March 10, 2002, the Company entered into a merger agreement with
ValueClick, Inc., a Delaware Corporation ("ValueClick"). Pursuant to the merger
agreement, the Company will be merged with, and become a wholly-owned
subsidiary of ValueClick. Upon consummation of the merger, each outstanding
share of Common Stock of the Company will be converted into the right to
receive 0.65882 shares of common stock of ValueClick. In the aggregate,
ValueClick will issue approximately 43.4 million shares of its common stock for
conversion of all of the outstanding securities of the Company. Upon
consummation of the merger, the Company's stockholders will own approximately
45% of the combined company's outstanding shares. The consummation of the
merger is subject to customary closing conditions, including the approval of
the stockholders of the Company and the stockholders of ValueClick and the
receipt of certain governmental approvals.

    In connection with the execution of the merger agreement, the Company
amended its stockholders' rights agreement (Note 10) to provide, among other
things, that ValueClick, Inc. would not be considered to be an "acquiring
person" thereunder by reason of any transaction contemplated by the merger
agreement.

                                     F-24

<PAGE>

                                  SIGNATURES

    Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, this Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.


                                         BE FREE, INC.
                                         (Registrant)
                                         By:   /S/  GORDON B. HOFFSTEIN
                                             -----------------------------

                                                   Gordon B. Hoffstein
                                                Chief Executive Officer
                                             and Chairman of the Board of
                                                       Directors

Date: March 22, 2002

    Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been duly signed below by the following persons on behalf of the
Registrant and in the capacities and on the date set forth above.

          Signature                       Title                  Date
          ---------                       -----                  ----
  /S/  GORDON B. HOFFSTEIN    Chairman of the Board,
-----------------------------   President, Chief Executive
     Gordon B. Hoffstein        Officer and Director
                                (Principal Executive
                                Officer)                    March 22, 2002
   /S/  STEPHEN M. JOSEPH     Executive Vice President,
-----------------------------   Chief Financial Officer and
      Stephen M. Joseph         Treasurer (Principal
                                Financial and Accounting
                                Officer)                    March 22, 2002
 /S/  SAMUEL P. GERACE, JR.   Executive Vice President,
-----------------------------   Chief Technology Officer
    Samuel P. Gerace, Jr.       and Director                March 22, 2002

   /S/  TED R. DINTERSMITH
-----------------------------
     Ted R. Dintersmith       Director                      March 22, 2002

  /S/  W. MICHAEL HUMPHREYS
-----------------------------
    W. Michael Humphreys      Director                      March 22, 2002

   /S/  JEFFREY F. RAYPORT
-----------------------------
     Jeffrey F. Rayport       Director                      March 22, 2002

    /S/  KATHLEEN L. BIRO
-----------------------------
      Kathleen L. Biro        Director                      March 22, 2002


                                     F-25

<PAGE>

                                 EXHIBIT INDEX

<TABLE>
<CAPTION>
Exhibit
  No.                                               Description
-------                                             -----------
<C>     <S>
  2.1   Agreement and Plan of Merger, dated as of March 10, 2002, by and among ValueClick, Inc., Bravo
        Acquisition I Corp. and Be Free, Inc. (Incorporated by reference to Exhibit 2.1 of the Company's
        current report on Form 8-K (File No. 000-27271) filed on March 12, 2002)

  3.1   Amended and Restated Certificate of Incorporation of the Registrant (Incorporated by reference to
        Exhibit 3.2 of the Company's Registration Statement on Form S-1 (File No. 333-84535) as declared
        effective by the SEC on November 2, 1999 (the "IPO Registration Statement")).

  3.2   Amendment, dated May 25, 2000, to the Amended and Restated Certificate of Incorporation of the
        Registrant (Incorporated by reference to Exhibit 3 of the Company's Amendment No. 1 to its
        Registration Statement on Form S-1 (333-37776) filed with the SEC on June 20, 2000 ("Amendment
        No. 1").

  3.3   Amended and Restated By-Laws of the Registrant (Incorporated by reference to Exhibit 3.4 of the
        IPO Registration Statement).

  4     Specimen certificate for shares of Common Stock, $0.01 par value per share, of the Registrant
        (Incorporated by reference to Exhibit 4 of the IPO Registration Statement).

 10.1   Amended and Restated 1998 Stock Incentive Plan, dated May 25, 2000 (Incorporated herein by
        reference to Exhibit 10.1 of Amendment No. 1).

 10.2   Stock Purchase and Shareholders Agreement, as amended, dated as of August 28, 1998 (Incorporated
        by reference to Exhibit 10.2 of the IPO Registration Statement).

 10.3   Form of Warrant dated as of August 28, 1998 (Incorporated by reference to Exhibit 10.3 of the IPO
        Registration Statement).

 10.4   Stock Purchase Agreement, as amended, dated as of September 29, 1998 (Incorporated by reference
        to Exhibit 10.4 of the IPO Registration Statement).

 10.5   Subordinated Loan and Security Agreement dated as of September 29, 1998 (Incorporated by
        reference to Exhibit 10.8 of the IPO Registration Statement).

 10.6   Registration Rights Agreement dated as of March 31, 1999 (Incorporated by reference to Exhibit 10.9
        of the IPO Registration Statement).

 10.7   Lease dated as of November 9, 1998 with Southwestern Pennsylvania Corporation (Incorporated by
        reference to Exhibit 10.12 of the IPO Registration Statement).

 10.8   Lease dated October 20, 1998 with LSOF Pooled Equity L.P. (Incorporated by reference to Exhibit
        10.13 of the IPO Registration Statement).

 10.9+  BFAST Service Order Form, as amended, with barnesandnoble.com, Inc. dated January 31, 1998
        (Incorporated by reference to Exhibit 10.15 of the IPO Registration Statement).

 10.10  Form of Indemnification Agreement dated August 28, 1998 (Incorporated by reference to Exhibit
        10.17 of the IPO Registration Statement).

 10.11  Agreement and Plan of Merger, dated February 15, 2000 by and among Be Free, Inc., Cyrano
        Acquisition Corp. and TriVida Corporation (Incorporated by reference to Exhibit 2 of the Company's
        Registration Statement on Form S-1 (File No. 333-31916) as filed with the SEC on March 8, 2000
        (the "March Registration Statement")).

</TABLE>

<PAGE>

<TABLE>
<C>   <S>
10.12 TriVida Corporation 1998 Equity Incentive Plan as assumed by the Company on February 29, 2000
      (Incorporated by reference to Exhibit 10.18 of the Company's Amendment No. 1 to its March
      Registration Statement filed with the SEC on March 16, 2000.)

10.13 Employment Agreement, dated as of June 1, 2001 by and between Be Free, Inc. and Gordon Hoffstein.

21    List of Subsidiaries.

23    Consent of PricewaterhouseCoopers LLP.

99.1  Amendment No. 1 to Rights Agreement, dated March 10, 2002, between Be Free, Inc. and Continental
      Stock Transfer & Trust Company (Incorporated by reference to Exhibit 99.1 of the Company's current
      report on Form 8-K (file No. 000-27271) filed March 12, 2002).
</TABLE>

--------
+  Confidential materials omitted and filed separately with the Securities and
   Exchange Commission pursuant to a Confidential Treatment Order granted in
   connection with the IPO Registration Statement.