<PAGE>   1
================================================================================

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

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

                                  FORM 10-K/A
                                AMENDMENT NO. 1
                                       TO

(MARK ONE)

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

                  FOR THE FISCAL YEAR ENDED DECEMBER 31, 2000

                                       OR

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

       FOR THE TRANSITION PERIOD FROM _______________ TO ______________.

                         COMMISSION FILE NUMBER 0-25577

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

                                AUTOWEB.COM, INC.
                  (OUR EXACT NAME AS SPECIFIED IN OUR CHARTER)

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

                 DELAWARE                                 77-0412737
     (STATE OR OTHER JURISDICTION OF                  (I.R.S. EMPLOYER
      INCORPORATION OR ORGANIZATION)                 IDENTIFICATION NO.)

                     3270 JAY STREET, SANTA CLARA, CA 95054
                    (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)

                                 (408) 970-9100
              (REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)

           SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

                                      NONE

             SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE
                                      ACT:

                         COMMON STOCK, $0.001 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 a shorter period if required), and
(2) has been subject to 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 this Form 10-K or any amendment to this
Form 10-K. [ ]

    The aggregate market value of the voting stock held by non-affiliates of the
Registrant, based on the closing price as reported on the Nasdaq National Market
at March 22, 2001, was approximately $6.5 million.

    The number of shares of the Registrant's Common Stock outstanding at March
22, 2001 was approximately 29,526,453 million shares.

================================================================================

                                EXPLANATORY NOTE

     This Annual Report on Form 10-K/A ("Form 10-K/A") is being filed as
Amendment No. 1 to the Registrant's Annual Report on Form 10-K filed with the
Securities and Exchange Commission on April 2, 2001 ("Form 10-K") for the
purpose of amending Item 3 of Part I, Item 7 of Part II, Items 10, 11, 12, and
13 of Part III and Item 14 of Part IV of the Registrant's Form 10-K.



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                                TABLE OF CONTENTS


<TABLE>
<CAPTION>
                                                                                              PAGE NO.
                                                                                              --------
<S>                                                                                           <C>
                                                PART I

Item 1.    Business..........................................................................     3

Item 2.    Properties........................................................................    10

Item 3.    Legal Proceedings.................................................................    10

Item 4.    Submission of Matters to a Vote of Security Holders...............................    10


                                                PART II

Item 5.    Market for the Registrant's Common Equity and Related Stockholder Matters.........    11

Item 6.    Selected Financial Data...........................................................    12

Item 7.    Management's Discussion and Analysis of Financial Condition and Results of
           Operations........................................................................    13

Item 7A.   Quantitative and Qualitative Disclosures About Market Risk........................    24

Item 8.    Financial Statements and Supplemental Data........................................    24

Item 9.    Changes in and Disagreements With Accountants on Accounting and Financial
           Disclosure........................................................................    25


                                               PART III

Item 10.   Directors and Executive Officers of the Registrant................................    26

Item 11.   Executive Compensation............................................................    30

Item 12.   Security Ownership of Certain Beneficial Owners and Management....................    34

Item 13.   Certain Relationships and Related Transactions....................................    36


                                                PART IV

Item 14.   Exhibits, Financial Statement Schedules and Reports on Form 8-K...................    37

           Signatures........................................................................    57
</TABLE>




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                                     PART I


ITEM 1. BUSINESS

    This Annual Report on Form 10-K, including the discussion of the Company's
business, contains forward-looking statements, within the meaning of Section 21E
of the Securities Exchange Act of 1934, and Section 27A of the Securities Act of
1933. Forward-looking statements involve risks and uncertainties that could
cause actual results to differ from anticipated results. In particular, factors
that could cause different results include the Company's failure to remain in
compliance with Nasdaq's other listing requirements in addition to the minimum
bid requirement, a Company decision not to pursue continued listing on the
Nasdaq National Market, a decision by the Nasdaq Listing Qualifications Panel to
delist the Company's common stock from the Nasdaq National Market, and the
Company's inability to find any strategic options to maximize shareholder value.
Other risks and uncertainties include changes in competitive behavior or market
forces, uncertainties regarding response from the vehicle manufacturers, changes
in the legal or regulatory environment, changes or lack of changes in consumer
preferences over time, technological challenges and an inability to forecast
future traffic and transactions. All these forward-looking statements are based
on information available to us on the date hereof, and we assume no obligation
to update any such forward-looking statements. Other factors that could cause
actual results to differ from those projected in these forward-looking
statements include without limitation those discussed below in "Factors That May
Affect Future Results." Readers are urged to carefully review and consider the
various disclosures made by us in this report, and those detailed from time to
time in our reports and filings with the Securities and Exchange Commission,
that attempt to advise interested parties of the risks and factors that are
likely to affect our business.


OVERVIEW

    Autoweb.com, Inc. ("Autoweb" or the "Company" or "we" or "us") is a leading
consumer automotive Internet service. Our Web site centralizes an extensive
collection of automotive-related commerce, content and community offerings to
assist consumers in researching, evaluating and buying vehicles and
automotive-related products and services such as insurance and financing. In
addition, we provide automotive content, Web hosting and development services
and sales automation services to vehicle manufacturers, dealers and online
partners. We were incorporated in California on October 3, 1995 as Downtown Web,
Inc. and reincorporated in Delaware on March 16, 1999 as Autoweb.com, Inc. Our
principal executive offices are located at 3270 Jay Street, Santa Clara,
California 95054, and our telephone number is (408) 970-9100.

    We began selling our services to automobile dealers and launched the
Autoweb.com Web site for consumer use in October 1995. Currently our network of
member dealers (where each franchise and pre-owned location for a particular
vehicle manufacturer is defined as a member dealer) is approximately 4,700.

    The Autoweb.com site and purchase process are designed to provide consumers
with dedicated customer care, choice and the means to execute their buying
decisions through a process that we believe is faster, better and easier than
traditional alternatives. During 2000, we delivered approximately 1.6 million
vehicle inquiries to member dealers and 1.5 million purchase inquiries to
automotive-related vendors ("category partners"). We believe we have a scalable
business model characterized by diverse revenue sources and synergy with online
category, infrastructure and advertising partnerships.

    Through our acquisition of Automotive Information Center ("AIC") in 1999, we
also provide consumers and automotive professionals with Autosite.com, a
20,000-page online vehicle buyer's guide and a rich suite of related services
information and original automotive editorial content.

Benefits to Consumers

    Convenient Purchase Process. The Autoweb.com purchase process provides an
environment that allows consumers to research, compare and select new or
pre-owned vehicles conveniently in the privacy of their home or office. From our
Web site, a consumer can submit a purchase inquiry to up to two member dealers
in a geographic area. The consumer is contacted by a member dealer, usually
within 24 hours of submitting their request and; given information on the
vehicle of their choice and up-front pricing over the phone or via e-mail.




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    Informed Purchase Decision. Consumers obtain online access to a wide range
of comprehensive, objective, up-to-date information about vehicle models,
options and dealer costs at no charge. Information such as vehicle
specifications and other information provided by AIC's comprehensive database,
Kelley Blue Book pre-owned vehicle values and reviews from Autoweb's
Professional Review are available in a centralized location. Our tools aid
consumers in finding a vehicle by offering the ability to search for a vehicle
by features (i.e., price, category, safety features, interior features).
Consumers can look at a variety of photographs of each vehicle and do a side by
side comparison of look, specifications and vehicle options. Additionally, at
Autosite.com, consumers have access to a 20,000-page online vehicle buyer's
guide, services and information.

    Availability of Automotive-Related Products and Services. Our Web site
offers consumers convenient access to a wide range of automotive-related
products and services, such as financing, insurance and maintenance, before and
after the purchase of a vehicle.

Benefits to Member Dealers

    Efficient Marketing and Sales Process. By joining our member dealer network,
member dealers gain access to a large number of purchase-minded consumers who
have, in many instances, already chosen the vehicle they wish to purchase. As a
result, member dealers can complete the sales process more quickly and
efficiently, potentially enabling them over time to reduce their labor and
overhead costs. Also, through its SalesEnhancer tool, Autoweb.com provides sales
automation tools to help member dealers (and non-member dealers) manage sales,
especially those sales related to their Internet marketing efforts.

    Flexible Automotive eSolutions. Autoweb.com has designed a flexible package
of services that assists dealerships in targeting on-line customers, improving
management of their online sales department and improve their on-line buying
service effectiveness. Dealers can choose from two different pricing models to
fit their needs. Under our "pay-for-performance" program, dealers pay only when
we provide a qualified purchase inquiry to them. In addition, our program
permits member dealers to customize the geographic radius from which they
receive purchase inquiries based on their evaluation of which purchase inquiries
will be most likely to result in vehicle sales. Under our "flat fee" program,
dealers set a customized geographic radius from which they receive a number of
purchase inquiries and pay a flat rate for a 90 day period. The flat rate is
based on a number of leads to be received per month.

    Purchase Inquiry Verification. We verify and append additional useful
information to over 2/3rds of the purchase inquiries processed through our Web
site. We filter out unsubstantiated purchase inquiries prior to sending them on
to our member dealers. This saves our dealer partners valuable time and
resources in tracking down dead-end leads or bad information.

Benefits to Others

    Vehicle Manufacturers. Autoweb.com provides vehicle manufacturers with
access to a large number of purchase-minded consumers from an attractive
demographic base. Using the targeted nature of Internet advertising,
manufacturers can advertise their brand image effectively to specific subsets of
Autoweb.com consumers. Vehicle manufacturers can deliver advertisements to
consumers who are researching vehicles of direct competitors, thereby increasing
the likelihood of influencing their purchase decisions. Furthermore, vehicle
manufacturers can sponsor packaged Autoweb.com services provided to member
dealers to improve sales of given vehicle makes and models. In addition, AIC,
provides automotive manufacturers with the data, tools and services used for
internal planning, competitive analysis and development and for re-publication
on their Web sites.

    Category Partners. We provide category partners with access to a large
number of purchase-minded consumers in the process of researching vehicles and
automotive-related products and services. Consumers seeking to purchase a
vehicle may wish to buy direct or may also require insurance, financing, car
accessories or related services from one of our online category partners.
Consumers seeking automotive information are also often interested in or
specifically researching competitive providers for their current
automotive-related services. Category partners can advertise to these consumers
or integrate their product with our Web site.

    Portals and Publishers. Integrating content and decision tools with diverse
commerce choices and lifecycle offerings, Autoweb.com provides partners with co-
and ingredient-branded automotive Web modules and turnkey destinations. AIC data
and comparison tools are the basis for online new car buying sites, media sites
and search engine buying services, providing these partners with high quality
data and service cost efficiencies.


STRATEGY




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    Our objective is to be a leading consumer automotive Internet service. Our
strategy is to leverage our consumer focus, traffic volume, information
expertise (automotive data, content and tools) and collaborative partnerships
with dealers, vehicle manufacturers, portals and category partners to create a
robust, dynamic automotive site.

Consumer Focus

    Optimize Consumer Experience. We provide the consumer with the data and
tools to research, compare and locate the car of their choice from a central Web
location.

Traffic Volume

    Increase Consumer Traffic. As part of our efforts to increase our consumer
traffic, we continue to focus our online advertising on a variety of high
traffic Web sites. The Autoweb.com Affiliates program launched in the second
quarter of 1998, had approximately 3,000 Web sites participating in the Program
in 2000. Under this program, affiliated Web sites are paid a fee to provide us
with additional traffic to our purchase request process. We also have
revenue-sharing arrangements with companies such as America Online, iWon.com,
Homestore.com and Lycos relating to purchase inquiries submitted by consumers
through links between our Web site and the other company's Web sites. We intend
to expand our revenue-sharing and affiliate programs with other selected Web
sites in an effort to drive additional consumer traffic to our site.

Information Expertise

    Enhance and Broaden Content Offerings. We provide high quality content which
facilitates consumer buying decisions related to and including the purchase of a
vehicle. We work with leading automotive content providers to provide consumers
with expert advice and information on our Web site. We have strong relationships
with the majority of vehicle manufacturers, such as General Motors and Ford,
including data licensing and on-going Web-based project using development of the
AIC competitive comparison product database. Furthermore, AIC currently has
commercial relationships to support its data licensing efforts with Yahoo!,
Excite, and Lycos. We intend to broaden the resources and services available to
consumers by developing relationships with other leading automotive content
providers.

    Increase Brand Awareness. Autoweb.com brand awareness is critical to our
being a leading consumer automotive Internet service. Our consumer branding
efforts are primarily focused on online advertising and infrastructure
partnerships with quality high traffic Web sites. We currently have long-term
marketing arrangements with America Online and Lycos and shorter term
advertising relationships with others. We ended a long-term marketing
relationship with Yahoo!, but continue to advertise on their Web site. Our
strategy is to increase our brand awareness further through continued online
advertising, co- and ingredient-branded infrastructure partnerships, traditional
media advertising and automotive industry focused media, ongoing public
relations efforts and expanded affiliate arrangements.

    Expand and Enhance Member Dealer Network. We believe that enhancing the
quality and franchise distribution of our member dealer network is critical to
our success. Our objective is to have at least one member dealer representing
each vehicle manufacturer make within a reasonable driving distance of every
consumer in the United States, with most consumers given a choice of several
dealers within a given area. We also offer limited service in Canada.




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SERVICES

    We currently offer the following services on our Web sites.

<TABLE>
<CAPTION>
            NAME OF SERVICE                                            DESCRIPTION
            ---------------                                            -----------
<S>                                           <C>
COMMERCE SERVICES

Autoweb.com New Vehicle Program               - Buy a new vehicle from our network of certified member
                                                dealers

Autoweb.com Pre-Owned Vehicle Program         - Buy a vehicle listed in our database of pre-owned inventory,
                                                either from one of our member dealers or from another
                                                consumer

Autoweb.com Sell Your Vehicle Program         - List a pre-owned vehicle for sale

Autoweb.com Vehicle Insurance                 - Obtain insurance quotes and purchase online with Insweb
                                                Insurance service

Autoweb.com Vehicle Financing                 - Obtain finance quotes from ProAct

Advertising                                   - Advertisers can advertise or participate in sponsorships on
                                                Autoweb.com and Autosite.com

Autosite.com Commerce Partners                - Buy automotive and related products and services from high
                                                quality commerce partners

SalesEnhancer.com                             - A sales automation tool to help member dealers (and non-member
                                                dealers) manage sales from walk-ins and those related to
                                                their Internet marketing efforts

Autoweb.com Extended Warranty                 - Obtain extended vehicle warranty quotes from Warranty Gold and
                                                Warrantybynet.com

Autoweb.com Parts and Accessories             - Obtain parts and accessories from CarParts.com and a parts
                                                catalog from JC Whitney

Autoweb.com Credit Reports                    - Purchase a personal credit report

Autoweb.com Lemon Check                       - Get a car screening and purchase a Lemon Check report through
                                                CarFax

Autoweb.com Service Center                    - Schedule vehicle service appointments online in Atlanta,
                                                Minneapolis/St. Paul, and Seattle


CONTENT SERVICES

Autosite.com                                  - A 20,000-page online vehicle buyer's guide and a rich source
                                                of related services, information and original automotive
                                                editorial content

AutoSite Pro                                  - An extensive source of competitive and product information
                                                for auto manufacturers

AutoSite Pro Lite                             - A product information source and data distribution point for
                                                print and electronic media

Autoweb.com Vehicle Research                  - Identify a specific vehicle and get the facts on the vehicle you
                                                want. Get prices, specifications and photos. Compare different
                                                cars and price different options

                                              - Browse vehicles by various financial, geographic and class
                                                criteria. Let Autoweb.com help you decide on your next car. Get
                                                prices, specifications and photos. Compare different cars
                                                and price different options
</TABLE>



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<TABLE>
<CAPTION>
            NAME OF SERVICE                                            DESCRIPTION
            ---------------                                            -----------
<S>                                           <C>
Autoweb.com Pre-Owned Vehicle Prices          - Obtain Kelley Blue Book pre-owned vehicle values

Autoweb.com Reviews                           - Obtain consumer reviews and professional reviews from
                                                Autoweb Professional Review, New Car Test Drive and The Car
                                                Connection

Autoweb.com Automotive News                   - Read about the latest automotive news from Reuters

Autoweb.com Automotive Guides                 - Use our troubleshooting guide to pinpoint the symptoms your car
                                                is exhibiting and learn possible causes

                                              - Use our maintenance and repair section to obtain automotive
                                                tips and hints provided by ASE

                                              - Use our selling vs. trading-in guide

                                              - Use our selling checklist to prepare your car for sale and
                                                help you get your full asking price

Autoweb.com Maintenance & Repair              - Obtain automotive tips and hints provided by ASE. Also reference
                                                maintenance guide and repair index

Autoweb.com Recalls & Service Bulletins       - Obtain vehicle recall information and technical service bulletins

Autoweb.com Loan/Lease Calculator             - Calculate your monthly auto expenses or compare loan vs lease
                                                payments

Autoweb.com Weekly Publication ("Fast Lane")  - Read weekly automotive editorials from industry experts

Autoweb.com Interior 360 degrees              - View 360 degrees photos of the interiors of the top 200
                                                vehicles through IPIX.
</TABLE>


SALES

    Sales to Dealers. We believe that the quality and franchise distribution of
our member dealer network is critical to our success. Our sales force seeks to
ensure that our member dealer network provides coverage such that consumers are
always within a reasonable driving distance of at least one member dealer. Our
regional specialists analyze purchase inquiries from areas not currently covered
by our member dealer network and target dealers within these areas to join our
program. Dealers are chosen based on their ability to meet this unsatisfied
demand and their agreement to adhere to the Autoweb.com purchase process.
Regional Account Managers are compensated based on building successful,
long-term dealer relationships. The same sales force is responsible for both the
New and Pre-Owned Vehicle Programs, since our Pre-Owned Vehicle Program is also
primarily targeted to franchised dealers, as opposed to independent dealers.

    Sales to Vehicle Manufacturers and Category Partners. The Autoweb.com
business development group is responsible for expanding our commerce services in
the vehicle and automotive-related markets. Category partners are selected based
on their ability to provide relevant, quality services online that enhance our
value to consumers. Business development is focused on expanding existing
service categories and adding new consumer categories. Additionally, AIC has a
business development group focused on Autosite.com online commerce partnerships
and a sales group focused on vehicle manufacturer products and services.

    Sales to Advertisers. Our advertising sales effort is primarily targeted to
vehicle manufacturers and automotive-related mass market consumer vendors.
Campaign specifications are typically negotiated with the advertising agency or
directly with the manufacturer or automotive-related vendor.


MARKETING




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    Our marketing strategy includes the following key points:

    Build Our Brand. To date, we have focused primarily on online promotions and
print media. In addition, our regular advertising in the leading automotive
trade publications has helped to build dealer brand awareness.

    Spend Efficiently on Advertising. Broad consumer interest in the automotive
category allows us to use a versatile advertising strategy. As a result, we have
been able to build our brand effectively through the efficient use of online
advertising and consumer promotional events including high profile, high traffic
Web sites such as America Online (and related properties), Yahoo! and Lycos.

    Increase Revenue Per Visitor. To increase revenue per visitor, we must
enhance and expand the content and increase the services available on our Web
site. We continue to expand our research content and tools and to add products
and services to aid consumers throughout the car ownership cycle.

    Develop Strategic Relationships. In addition to our advertisements, we have
created revenue-sharing relationships with brand leaders such as America Online,
iWon.com and Lycos. We intend to continue to develop strategic relationships
that will provide not only brand exposure but also valuable content for our Web
site.

    Expand the Autoweb.com Affiliates Program. The Autoweb.com Affiliates
Program allows other Web sites to link with the Autoweb.com Web site. The
affiliates receive a commission for traffic and consumers delivered to the
Autoweb.com site. This program generates brand awareness and revenue for a lower
relative cost. We intend to expand this program in the future.


TECHNOLOGY

    We believe that we have built a robust, scalable user interface, a content
delivery and transaction processing system that is designed around industry
standard architectures and internally-developed proprietary software. Our system
records and collects operational data records regarding franchised dealers,
billing information, pre-owned vehicle listings and new and pre-owned vehicle
purchase inquiries. Our system also handles other aspects of the new and
pre-owned vehicle buying process, including submitting XML, e-mail and facsimile
copies of consumer purchase inquiries to member dealers and submitting insurance
and finance inquiries, as well as other inquiries to our affiliated partners.

    We have an online system available for member dealers, advertisers and
category partners to access relevant information. For example, member dealers
can access an Autoweb.com Web site to manage their pre-owned car inventory by
adding, modifying or updating their listings, as well as uploading pictures of
pre-owned cars. Member dealers can view their customer information and generate
reports based on their customers' survey responses. Autoweb.com affiliates can
also use our extranet to view activity summaries of their account.

    The Autoweb.com service provides 24 hour a day, seven day a week
availability, subject to occasional short maintenance periods and power outages.
The State of California is suffering an energy crisis and has periodically
implemented rolling black outs throughout the state. It is anticipated that the
energy crisis will continue into the near future resulting in continued
shortages of electricity and power outages. Our system hardware is hosted and
located at Exodus Communications, Inc. in Santa Clara, California. Exodus
provides for an independent back up power source in order to prevent a break in
service to the Internet. Our network is protected by a firewall from Checkpoint.
We have engineered redundancy into our systems. Both firewalls and load balances
are set up with "hot fail" switchover, minimizing service impact if systems
fail. Our system consists of Dell database servers running Microsoft SQL and
several Pentium-based Microsoft Internet servers running on Windows NT operating
systems. We use Allaire Cold Fusion for most of our Web application development
and delivery.




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COMPETITION

    The market for the purchase of vehicles and automotive-related products and
services is intensely competitive, and we expect competition to increase
significantly, particularly on the Internet. Barriers to entry on the Internet
are relatively low, and we face competitive pressures from numerous companies.
Currently, we believe our most significant competitors are MSN CarPoint and
Autobytel.com. There are also a number of Web sites that offer vehicles,
particularly vehicle manufacturers' own Web sites and sites for electronic
classified ads. Additionally, there are numerous Web sites that offer vehicle
information and other content, as well as community offerings, directly to the
vehicle buying consumer or targeted audiences such as car collectors. We also
face competition from large dealer groups and traditional media companies, such
as newspaper, television and radio companies, many of which currently operate a
Web site. In addition to direct competitors, we also compete indirectly with
vehicle brokerage firms, discount warehouse clubs and automobile clubs. Several
auction Web sites auction vehicles on the Internet. We also compete with a
variety of automotive data, vehicle manufacturer and dealer services companies.

    We believe that the principal competitive factors in attracting consumers to
our Web site are:

    -  a positive vehicle purchasing experience for the consumer;

    -  brand awareness and loyalty;

    -  breadth of selections;

    -  ease of use;

    -  having adequate geographic coverage of member dealers;

    -  Web site functionality, responsiveness and information; and

    -  quality of content, service offerings and customer service.

    We believe that the principal competitive factors in attracting member
dealers, category partners and advertisers include:

    -  the volume of our Web site traffic;

    -  our brand awareness and loyalty;

    -  the demographics of our consumers;

    -  the cost effectiveness of purchase inquiries we deliver; and

    -  the cost effectiveness of advertising on our Web site.

    Many of our existing and potential competitors have longer operating
histories in the Internet market, greater name recognition, larger consumer
bases and significantly greater financial, technical and marketing resources
than we do. These competitors may be able to undertake more extensive marketing
campaigns for their brand, products and services, adopt more aggressive pricing
policies and make more attractive offers to potential employees. Furthermore,
our existing and potential competitors may develop offerings that equal or
exceed the quality of our offerings, or achieve greater market acceptance, than
ours. We cannot assure you that we will be able to compete successfully against
our current or future competitors or that competition will not have a material
adverse effect on our business, results of operations and financial condition.


PROPRIETARY RIGHTS

    We regard our patents, trademarks, trade secrets, and similar intellectual
property, including our rights to certain domain names, as critical to our
success. We rely upon trademark, patent and copyright law, trade secret
protection and confidentiality or license agreements with our employees,
customers, partners, and others to protect our proprietary rights. For example,
we have obtained trademark registration for Autoweb and Autoweb.com. We attempt
to ensure that the quality of our brand is maintained by our licensees, however,
our licensees may take actions that could materially adversely affect the value
of our proprietary rights or the reputation of our products. Protection of the
distinctive elements of Autoweb.com may not be available under the law. We
cannot guarantee that the steps we have taken to protect our proprietary rights
will be adequate.

PRIVACY POLICY




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<PAGE>   10

    We believe that issues relating to privacy and use of personal information
relating to Internet users are becoming increasingly important as the Internet
expands and its commercial use increases. We have adopted and posted to the Web
site a privacy policy concerning how we use information about our consumer
visitors and the extent to which others may have access to this information. We
use information about our consumer visits for internal purposes in order to
improve marketing and promotional efforts to analyze Web site usage
statistically and to improve content, product offerings and Web site layout. Any
refinements of our privacy policy will be clearly disclosed to our Web site
visitors.


EMPLOYEES

    As of December 31, 2000, we had 152 full-time employees, including 48 in
sales and marketing and 104 in general and administration. We have never had a
work stoppage, and no employees are represented under collective bargaining
agreements.


ITEM 2. PROPERTIES

    Our principal administrative, marketing and product development facilities
are located in approximately 23,880 square feet of office space in Santa Clara,
California. The lease for this space expires on August 1, 2004 and does not
provide for a renewal option. We also lease office space in Westborough,
Massachusetts, Los Angeles, California and Detroit, Michigan. We believe that
these spaces will be adequate to meet our needs in the foreseeable future.


ITEM 3. LEGAL PROCEEDINGS

    In April 2001, a class action complaint was filed in the United States
District Court for the Southern District of New York against us, certain of our
current and former directors and officers and the underwriters involved in our
initial public offering, alleging violations of the Securities Act of 1933 and
of the Securities Exchange Act of 1934. The plaintiff seeks to act on behalf of
purchasers of Autoweb common stock and is seeking unspecified damages. We
believe we have meritorious defenses to the complaint and we intend to
vigorously defend the action.

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

    No matters were submitted to a vote of our security holders during the
fourth quarter of the year ended December 31, 2000.




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                                     PART II

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

    (a) Market for Registrant's Common Equity. The principal market for the
Company's common stock is the Nasdaq National Stock Market, where it is traded
under the symbol "AWEB." The Company's initial public offering of its common
stock was declared effective on March 22, 1999. The following table sets forth
for the periods indicated the high and low sales prices of our Common Stock as
reported by the Nasdaq National Stock Market:

<TABLE>
<CAPTION>
                                                                   HIGH      LOW
                                                                   ----      ---
    <S>                                                           <C>      <C>
    1999:
    First Quarter (from March 23, 1999) ........................  $50.00   $ 19.63
    Second Quarter..............................................   41.25     11.50
    Third Quarter...............................................   18.31      8.06
    Fourth Quarter..............................................   14.13      8.25

    2000:
    First Quarter ..............................................  $12.00    $ 5.50
    Second Quarter..............................................    7.38      2.00
    Third Quarter...............................................    2.75      1.03
    Fourth Quarter..............................................    1.75      0.19

    2001:
    First Quarter (through March 22, 2001,
      the latest practicable trading date)......................  $ 0.56    $ 0.19
</TABLE>

    On March 22, 2001, the last reported sales price of the Company's common
stock on the Nasdaq National Stock Market was $0.22 per share. As of March 22,
2001, there were approximately 340 holders of record of the Common Stock.
Brokers and other financial institutions hold many such shares on behalf of
stockholders. We estimate the total number of stockholders represented by these
record holders to be approximately 9,400.

    We have never declared or paid any cash dividends on our capital stock. We
currently anticipate that we will retain all future earnings for use in our
business and do not anticipate paying any cash dividends in the foreseeable
future.

    (b) The Company did not make any unregistered sales of the Company's common
stock during the fourth quarter of fiscal 2000.




                                       11
<PAGE>   12

ITEM 6. SELECTED FINANCIAL DATA

    The following selected financial data should be read in conjunction with
Autoweb.com's financial statements and related notes and "Management's
Discussion and Analysis of Financial Condition and Results of Operations"
included elsewhere in this Form 10-K.

<TABLE>
<CAPTION>
                                                                           YEARS ENDED DECEMBER 31,
                                                                           ------------------------
                                                         2000          1999          1998         1997         1996
                                                       --------      --------      --------      -------      -------
                                                                   (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<S>                                                    <C>           <C>           <C>           <C>          <C>
STATEMENTS OF OPERATIONS DATA:
Net revenues ........................................  $ 52,280      $ 32,792      $ 13,041      $ 3,492      $   307
Loss from operations ................................   (36,863)      (20,214)      (11,425)      (2,971)        (835)
Net loss attributable to common stockholders ........   (38,370)      (18,153)      (12,374)      (3,196)        (853)
Net loss per share attributable to common
stockholders:
    Basic and diluted ...............................  $  (1.36)     $  (0.85)     $  (1.58)     $ (0.41)     $ (0.11)
    Weighted average shares--basic and diluted ......    28,291        21,425         7,850        7,794        7,497
</TABLE>

<TABLE>
<CAPTION>
                                                                                DECEMBER 31,
                                                                                ------------
                                                         2000          1999          1998         1997         1996
                                                       --------      --------      --------      -------      -------
                                                                                (IN THOUSANDS)
<S>                                                    <C>           <C>           <C>           <C>          <C>
BALANCE SHEET DATA:
Cash, cash equivalents and short-term investments ...  $ 27,137      $ 30,284      $  2,714      $ 1,819      $    11

Restricted cash .....................................        --         2,550            --           --           --
Working Capital .....................................    40,021        39,607           800          773         (761)
Total assets ........................................    60,144        71,677         7,185        3,294          261
Long-term obligations, less current portion .........        --           361           654           17           81
Mandatorily redeemable convertible preferred stock ..        --            --        12,969        5,261          158

Total stockholders' equity (deficit) ................    54,361        60,686       (11,661)      (4,030)        (884)
</TABLE>




                                       12
<PAGE>   13

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

     This Annual Report on Form 10-K, including the discussion of our business,
should be read in conjunction with the Consolidated Financial Statements and
Notes, thereto, of Autoweb.com, Inc. The following discussion contains
forward-looking statements. Forward-looking statements involve risks and
uncertainties that could cause actual results to differ from anticipated
results. In particular, factors that could cause different results include, but
are not limited to: our ability to attract consumers through existing portal
relationships; the combined viability of current and new car buying process on
our site; consumer acceptance of online car buying; our ability to continue to
reduce expenses without comparable or greater revenue reductions; the effect of
the restructuring of certain marketing agreements; the failure to realize
anticipated synergies related to the proposed merger with Autobytel.com, failure
to obtain required stockholder or regulatory approvals or the merger not closing
for any other reason, failure of the combined company to retain and hire key
employees, and difficulties in successfully integrating the parties' businesses
and technologies.

     Other uncertainties include the fact that the Company received a Nasdaq
Staff Determination letter on March 1, 2001, indicating that Autoweb has failed
to comply with the minimum bid price requirement for continued listing, and is
subject to delisting from the Nasdaq National Market; changes in competitive
behavior or market forces; uncertainties regarding response from the vehicle
manufacturers; changes in the legal or regulatory environment, changes or lack
of changes in consumer preferences over time, technological challenges and an
inability to forecast future traffic and transactions. Other statements that
could cause actual results to differ from those projected in these
forward-looking statements include without limitation, those discussed below in
the "Factors That May Affect Future Results." Readers are urged to carefully
review and consider the various disclosures made by us in this report, and those
detailed from time to time in our reports and filings with the Securities and
Exchange Commission that attempt to advise interested parties of the risks and
factors that are likely to affect our business.

OVERVIEW

    Autoweb.com is a leading consumer automotive Internet service. Our Web site
centralizes an extensive collection of automotive-related commerce, content and
community offerings to assist consumers in researching, evaluating and buying
vehicles and automotive-related products and services such as insurance and
financing. In addition, we provide automotive content, Web hosting and
development services and sales automation services to vehicle manufacturers,
dealers and online partners. Through our acquisition of Automotive Information
Center, or AIC, in 1999, we now provide consumers and automotive professionals
with Autosite.com, a 20,000-page online vehicle buyer's guide and a rich suite
of related services information and original automotive editorial content.

    We began selling our services to automobile dealers and launched the
Autoweb.com Web site for consumer use in October 1995. Currently our network of
member dealers (where each franchise and pre-owned location for a particular
vehicle manufacturer is defined as a member dealer) is approximately 4,700. We
currently derive approximately 60% of our revenues from fees charged to our
member dealers in exchange for qualified purchase inquiries. The revenue related
to each fee is recognized in the month the qualified purchase inquiry is
provided to the member dealer. We also provide online advertising space on the
Autoweb.com site. Revenues from advertising contracts, which typically have
terms of less than three months, are recognized as the contracts are fulfilled.
In addition, we offer automotive-related services on the Autoweb.com site
through agreements with third-party category partners. We derive revenues from
third parties for the right to provide its consumer services, such as automobile
financing and insurance, on our Web site. Revenues from these agreements are
generally recognized ratably over the terms of the agreements.

    We incurred net losses of $38.4 million, $18.2 million and $11.5 million in
2000, 1999 and 1998, respectively. Our limited operating history makes it
difficult to forecast future operating results. We cannot be certain that net
revenues will increase at a rate sufficient to achieve and maintain
profitability. Even if we were to achieve profitability in any period, we might
fail to sustain or increase that profitability on a quarterly or annual basis.

    During 1999, the company acquired technology and other assets from
SalesEnhancer for approximately $3.7 million in cash. SalesEnhancer is an
internet based sales management application for the automotive industry. Also
during 1999, the company acquired certain assets and liabilities of AIC, a
division of the Gale Group, Inc., for 363,636 shares of common stock valued at
$3.3 million and $16.0 million in cash.

    On April 11, 2001, Autoweb entered into a definitive acquisition agreement
with Autobytel. The merger is expected to close late in the second calendar
quarter or early in the third calendar quarter of 2001 upon satisfaction of
customary and other closing conditions and receipt of governmental and
stockholder approvals. Under the terms of the agreement, Autoweb stockholders
will receive 0.3553 shares of Autobytel common stock in exchange for each share
of Autoweb common stock. Outstanding stock options to purchase shares of
Autoweb common stock will be assumed after adjustment at the same exchange
ratio. Autobytel intends to account for the merger as a purchase transaction.

RESULTS OF OPERATIONS

Reclassification

    Stock-based compensation expense has been reclassified to the relevant
functional expense categories in the years ended December 31, 1999 and 1998 to
conform with the presentation for the year ended December 31, 2000. The
reclassification has no impact on the previously reported operating loss or net
loss.




                                       13
<PAGE>   14

Net Revenues

    Net revenues were $52.3 million, $32.8 million, and $13.0 million for the
years ended December 31, 2000, 1999, and 1998, respectively. The increase in net
revenues from 1999 to 2000 was primarily driven by increased net dealer revenue
fees which accounted for 63% of the increase, the fact that the fiscal year
ended December 31, 2000 contained twelve months of revenues from AIC which
accounted for 24% of the increase, with the majority of the remaining increase
driven by advertising. The increase in net revenues from 1998 to 1999 was driven
by increased net dealer revenue fees which accounted for 58% of the increase and
increases in revenues from advertising accounted for a majority of the
remaining increase. The increases in net dealer fee revenues in 2000 and 1999
are primarily the result of increases in the number of purchase inquiries that
we provided to our member dealers and automotive-related vendors, or category
partners.

Cost of Net Revenues

    Cost of net revenues were $6.7 million, $3.3 million, and $842,000 for the
years ended December 31, 2000, 1999, and 1998, respectively. The increase in
cost of revenues from 1999 to 2000 was primarily driven by increases in partner
lead fees which accounted for 58% of the increase and Web site operation costs
which accounted for a majority of the remaining increase. The increase in cost
of revenues from 1998 to 1999 was driven by increases in partner lead fees,
which accounted for 42% of the increase, web site operations, which accounted
for 42% of the increase and providing site content information which accounted
for a majority of the remaining increase. The increases in 2000 and 1999 partner
lead fees are related to the expansion in the number of co-branded sites and
affiliate relationships which has increased the number of consumer purchase
inquiries.

Sales and Marketing

    Sales and marketing expenses were $53.6 million, $34.7 million, and $16.6
million for the years ended December 31, 2000, 1999, and 1998, respectively. The
increase in sales and marketing costs from 1999 to 2000 was primarily the result
of increases in on-line advertising which accounted for 81% of the increase,
increases in personnel costs, which accounted for 14% of the increase as well as
the fact that the year ended December 31, 2000 contained twelve months of AIC
sales and marketing costs. The increase in sales and marketing costs from 1998
to 1999 was primarily driven by increases in on-line advertising which accounted
for 81% of the increase, and to a lesser extent, increases in public relations
costs, advertising in traditional media, trade shows, and other promotions.
Sales and marketing expenses include $525,000, $1.5 million and $3.0 million of
stock based compensation expense for the years 2000, 1999 and 1998,
respectively.

Product Development

    Product development expenses were $8.9 million, $5.7 million, and $1.8
million for the years ended December 31, 2000, 1999, and 1998, respectively. The
increase in product development costs from 1999 to 2000 and from 1998 to 1999
increased primarily as a result of increased hiring of product development
personnel and, to a lesser extent, as a result of increased occupancy costs.
Product development expenses include ($26,000), $571,000 and $1.2 million of
stock based compensation expense for the years 2000, 1999 and 1998,
respectively.

General and Administrative

    General and administrative expenses were $13.0 million, $7.4 million, and
$5.3 million for the years ended December 31, 2000, 1999, and 1998,
respectively. The increase in general and administrative costs from 1999 to 2000
was primarily driven by the fact that general and administrative costs for the
year ended December 31, 2000, contained twelve months of AIC costs which
accounted for approximately 65% of the increase, the remaining increase was
primarily due to twelve months of SalesEnhancer costs. The increase in general
and administrative costs from 1998 to 1999 was driven by higher personnel costs
resulting from the hiring of administrative personnel which accounted for 37% of
the increase, higher information technology support related to administrative
functions, higher occupancy costs, and increases in professional consulting
fees. General and administrative expenses include $1.1 million, $207,000, and
$1.5 million of stock based compensation expense for the years 2000, 1999 and
1998, respectively.

Amortization of Intangible Assets




                                       14
<PAGE>   15

    Amortization of intangible assets was $7.0 million and $1.9 million, for the
years ended December 31, 2000 and 1999, respectively. The increase in
amortization from 1999 to 2000 was primarily driven by twelve months
amortization related to the acquisition of AIC which accounted for 88% of the
increase with the remaining increase due to the acquisition of SalesEnhancer.
The amortization in 1999 was related to the acquisition of AIC which accounted
for 87% of the amortization, with SalesEnhancer accounting for the remaining
portion.

Interest and Other Income (Expense), Net

    Interest and other income (expense), net were $1.6 million, $2.1 million,
and ($59,000), for the years ended December 31, 2000, 1999, and 1998,
respectively. The decrease in interest and other income (expense) net from 1999
to 2000 is primarily the result of a lower average investment balance during
2000 driven primarily by our net loss for the year, partially offset by the
issuance of common stock for a total of $29.8 million. The increase in interest
and other income (expense), net from 1998 to 1999 was primarily driven by a
higher average investment balance during 1999 as a result of net proceeds from
our initial public offering.

Loss on investment

    The loss on investment of $3.1 million in 2000 relates to an impairment
write-down of an investment in the equity securities of a private company.


Income Taxes

    We recorded a net loss of $38.4 million, $18.2 million, and $11.5 million
for the years ended December 31, 2000, 1999, and 1998, respectively.
Accordingly, no provision for income taxes was recorded in any of these years.
The resulting tax deferred asset, representing primarily such net operating loss
carry forwards, has been reduced in full by a valuation allowance as it is more
likely than not that the deferred tax asset will not be realized.

Liquidity and Capital Resources

    Net cash used in operating activities was $31.1 million, $24.2 million, and
$4.6 million for the years ended December 31, 2000, 1999, and 1998,
respectively. Net cash used in operating activities in 2000 was primarily due to
the net loss for the year of $38.4 million, partially offset by amortization of
intangible assets of $7.0 million related to the acquisitions of AIC and
SalesEnhancer. Net cash used in operating activities in 1999 was primarily due
to the net loss for the year, the increase in prepaid expenses and other current
assets, accounts receivable and restricted cash. Net cash used in operating
activities in 1998 was primarily due to net losses for the year offset in part
by the amortization of stock-based compensation.

    Net cash (used in) provided by investing activities was $18.8 million,
($40.8) million, and ($1.2) million for the years ended December 31, 2000, 1999,
and 1998, respectively. The increase in cash provided by investing activities
from 1999 to 2000 was primarily due to the maturity of short-term investments
purchased in 1999 which accounted for $41.8 million of the increase while cash
used of $16.0 million to purchase AIC in 1999 accounted for a majority of the
remaining variance. The increase in cash used in investing activities from 1998
to 1999 is primarily the result of the purchase of short-term investments as
well as cash paid in 1999 for the acquisition of AIC.

    Net cash provided by financing activities was $30.0 million, $71.7 million,
and $6.7 million for the years ended December 31, 2000, 1999, and 1998,
respectively. The decrease in cash provided by financing activities from 1999 to
2000 is primarily the result of net proceeds of $71.7 million received in 1999
from the issuance of common stock in our initial public offering. During 2000
the company issued common stock to both Lycos, Inc. and CarsDirect for a total
of $29.8 million in cash.

    During 2000 the Company recognized approximately $3.4 million of revenue
from dealer sales to CarsDirect and was compensated by the issuance of preferred
stock, valued at $3.1 million, in the non-public company and cash of
approximately $300,000. Subsequently in 2000 the Company recorded a charge of
$3.1 million to reflect an other than temporary impairment in the value of those
preferred shares. In addition, in April 2000, CarsDirect purchased newly-issued
shares of common stock of the Company that represented less than 3% of its
outstanding shares for cash of $7.7 million in 2000.




                                       15
<PAGE>   16

    During the fourth quarter of 2000 we announced two initiatives to focus
resources and exercise fiscal control. First, during the fourth quarter we
reduced our workforce by approximately 25% in an effort to focus on content and
technology offerings, order fulfillment and customer relationship management for
the automotive industry. The annual savings from the reduced workforce is
estimated to be approximately $10 million. Second, we commenced efforts to
reduce our marketing costs through the restructure of certain marketing
agreements. These efforts are crucial if the Company is to reduce its future
operating loss. In this regard, we paid $13.3 million in March 2001 so that as
of March 31, 2001 we have reduced our future marketing cash obligations to $22.0
million, from $56.8 million at December 31, 2000. As our marketing agreements
are restructured, it is critical to our success that we are able to replace any
reduced or lost traffic.

    We had no material commitments for capital expenditures at December 31,
2000. As of that date, we had total minimum lease obligations of $3.6 million
under certain non-cancelable operating leases. We believe that our current cash
and cash equivalents will be sufficient to meet our anticipated needs for
working capital and capital expenditures for at least the next 12 months.
Depending on our rate of growth and cash requirements, we may require additional
equity or debt financing to meet future working capital or capital expenditure
needs. There can be no assurance that such additional financing will be
available, or if available, that such financing can be obtained on terms
satisfactory to us.

    At December 31, 2000, the total of our cash, cash equivalents, and
short-term equivalents were $27.1 million before the payment of the $13.3
million in March 2001 associated with the restructuring of certain marketing
agreements. Our failure to raise capital when needed could have a material
adverse effect on our business, financial condition and operating results. Our
future liquidity may be impacted if our shares are delisted from the NASDAQ
National Market as discussed more fully below in "Factors That May Affect Future
Results".


FACTORS THAT MAY AFFECT FUTURE RESULTS

We have a limited operating history under our current business model

    As part of our business strategy, we acquired AIC in 1999. As a result of
the acquisition, approximately 40% of our employees are now based outside of our
Santa Clara headquarters. If we are unable to effectively manage a large and
geographically dispersed group of employees, our business will be adversely
affected. In addition, we have a limited operating history and unproven business
model as a combined company. A number of risks and challenges accompany our
model, including:

    -  the difficulty of continuing to assimilate the operations and personnel
       of the combined entities;

    -  the impairment or integration of relationships with employees or
       customers as a result of any integration of the combined companies;

    -  the ability of the combined company to continue to generate revenue
       streams from fees for consumer inquiries, advertising, automotive content
       and technology;

    -  the difficulty in maintaining a consumer, dealer, OEM, and affiliate or
       category partner customer base.

    We may not be successful in addressing these risks or any other problems
encountered in connection with our current business model.

If we are unable to maintain our Nasdaq National Market Listing, the liquidity
of our common stock would be seriously limited.

    On March 1, 2001, the Company received a Nasdaq Staff Determination
indicating that the Company has failed to comply with the minimum bid price
requirement for continued listing, and is subject to delisting from the Nasdaq
National Market. The Company has filed a request for a hearing before the Nasdaq
Qualifications Panel ("Panel") to review the staff determination. The hearing
was held on April 12, 2001.

    There can be no assurance that the Panel will decide to allow the Company to
remain listed or that the Company's actions will prevent the delisting of its
common stock. The Company will not be notified until the Panel makes a formal
decision. Until then, the Company's shares will continue to trade on the Nasdaq
National Market. In the event the Company's shares are delisted from the Nasdaq
National Market, we will attempt to have our common stock traded on the NASD
over-the counter Bulletin Board.




                                       16
<PAGE>   17

    If our common stock is delisted, it would seriously limit the liquidity of
our common stock and limit our potential to raise future capital through the
sale of our common stock, which could have a material adverse effect on our
business.

Our operating results are likely to fluctuate significantly

    Our results of operations have varied widely in the past, and we expect that
they will continue to vary significantly from quarter to quarter due to a number
of factors described below and elsewhere in this Form 10-K.

    Our revenue growth rates, if any, may not be sustainable. Any shortfall in
our revenues would immediately increase our operating losses and would adversely
affect the market price of our common stock. We continue to be substantially
dependent on member dealer fees. Therefore, our quarterly revenues and operating
results are likely to be particularly affected by the level of member dealer
fees in each quarter. If revenues fall below our expectations, we will not be
able to reduce our spending rapidly in response to such a shortfall. This will
adversely affect our operating results.

    We believe that we may experience seasonality in our business. The seasonal
patterns of Internet usage and vehicle purchasing do not completely overlap.
Internet usage typically declines during the summer and certain holiday periods,
while vehicle purchasing in the United States is strongest in the late spring
and summer months. We cannot predict which seasonal pattern, if any, will
dominate.

    Due to the foregoing factors and factors described elsewhere in this Form
10-K, we believe that quarter-to-quarter comparisons of our results of
operations are not a good indication of our future performance. It is likely
that our results of operations in some future quarter may be below the
expectations of public market analysts and investors. In this event, the price
of our common stock is likely to decline.

We have a history of net losses and expect net losses for the foreseeable future

    We have incurred net losses in each fiscal year since our inception,
including a net loss of $38.4 million in 2000. We had an accumulated deficit of
$74.2 million as of December 31, 2000. The size of future net losses will
depend, in part, on the rate of growth in our revenues from member dealer fees,
category partners fees, advertising sales and other e-commerce activities. It is
critical to our success that we continue to expend financial and management
resources to develop Autoweb.com brand awareness and loyalty through marketing
and promotion, expansion of our member dealer network, development of our online
content and expansion of our other services. As a result, a significant portion
of our operating expenses for the next several years will continue in sales and
marketing. With these expenses, we will need to generate significant additional
revenues to achieve profitability. As a result, we may never achieve or sustain
profitability, and, if we do achieve profitability in any period, we may not be
able to sustain or increase profitability on a quarterly or annual basis.

Our business is dependent on the economic strength of the automotive industry

    The economic strength of the automotive industry significantly impacts the
revenues we derive from our member dealers, vehicle manufacturers and category
partners, advertising revenues and consumer traffic to our Web site. The
automotive industry is cyclical, with vehicle sales fluctuating due to changes
in national and global economic forces. Vehicle sales in the United States have
been declining in the latter part of 2000. We cannot assure you that vehicle
sales will increase or stay at their current levels. A further decrease in the
current level of vehicle sales could have a material adverse effect on our
business, results of operations and financial condition.

We currently rely heavily on member dealers

    We derive the majority of our revenues from member dealer fees (payments
from member dealers for each purchase inquiry that we provide to them), and we
expect to continue to do so for the foreseeable future. Member dealer fees
represented approximately 60%, 66%, and 78% of our net revenues in 2000, 1999,
and 1998 respectively. Consequently, our business is highly dependent on
consumers' use of Autoweb.com to purchase vehicles so that member dealers will
achieve a satisfactory return on their investment in the Autoweb.com program.




                                       17
<PAGE>   18

    The success of our business strategy depends on our member dealers'
adherence to the Autoweb.com purchase process, including responding to consumer
purchase inquiries within 24 hours, providing a competitive, firm quote to
consumers during the initial communication, explaining the Autoweb.com purchase
process to the consumer and answering any consumer questions. We devote
significant efforts and resources to certifying and supporting participating
member dealers in these practices that are intended to increase consumer
satisfaction. Our inability to certify and support member dealers effectively,
or member dealers' failure to adopt such practices, respond rapidly and
professionally to vehicle purchase inquiries, or sell vehicles in accordance
with our marketing strategies, could result in low consumer satisfaction and
materially adversely affect our business, results of operations and financial
condition.

    To maintain and increase our network of member dealers, we must reduce the
rate of turnover of our member dealers. Commencing in February 1998, we
introduced a new "pay for performance" pricing model and began actively to
convert our existing member dealers to this model. Prior to that time, all of
our member dealers were on a subscription model under which they paid a fixed
amount per month regardless of the number of purchase inquiries that we provided
to them. During 1998, we lost approximately 60% of the member dealers that we
had at the beginning of the year and converted approximately 30% to the new
pricing model. During 1998, we lost approximately 22% of the performance-based
member dealers that we converted or with which we first entered into a contract
in 1998. During 1999, we lost approximately 31% of the performance-based member
dealers that we had at the beginning of the year or first entered into a
contract during the year. During 2000, we lost approximately 49% of the
performance-based member dealers that we had at the beginning of the year.

    Attrition remains high and there is increased competition from the
automobile manufacturers and dealers entering this market on their own. We
cannot assure you that we will be able to reduce the level of this attrition,
and our failure to do so could materially and adversely affect our business,
results of operation and financial condition.

We must leverage our current technology assets and develop our information
services business.

    Information and technology has a high value to our customers and potential
customers that may generate significant additional revenue. In order to
capitalize on this revenue stream, we must build on our existing data and
technology business and develop our information services. This undertaking must
be executed rapidly and is likely to be expensive and complex and require
additional technical expertise. Also, as we acquire users who rely upon us for a
wide variety of services, it becomes more technologically complex and costly to
retrieve, store and integrate data that will enable us to track each user's
preferences. Any loss of traffic, increased costs, inefficiencies or failures to
adapt our existing and new technologies and the associated adjustment to our
business plan would have a material effect on our business.

We need to build strong brand loyalty

    We believe that maintaining and expanding the Autoweb brand is critical to
attracting consumers, member dealers, vehicle manufacturers, category partners
and advertisers. Furthermore, we believe that the importance of brand loyalty
will increase as low barriers to entry encourage the proliferation of Web sites.
We have spent considerable monies and resources on the establishment and
maintenance of the Autoweb brand and will continue to do so in the form of
online advertising campaigns, print media, and other forms of traditional
advertising. We may not be able to successfully maintain or enhance consumer
awareness of our brand and, even if we are successful in our branding efforts,
such efforts may be costly. If we are unable to maintain or enhance customer
awareness of the Autoweb brand in a cost-effective manner, our business,
operating results and financial condition would be materially and adversely
affected.

We depend on third-party relationships

    We have entered into agreements with various category partners, some of
which require us to feature them exclusively in certain sections of our Web
site. Existing and future exclusive arrangements may prevent us from entering
into other content agreements, advertising or sponsorship arrangements or other
commercial relationships. Many companies that we may pursue for a commercial
relationship may also offer competing services. As a result, these competitors
may be reluctant to enter into commercial relationships with us. Our business
could be adversely affected if we do not maintain our existing commercial
relationships on terms as favorable as currently in effect, if we do not
establish additional commercial relationships on commercially reasonable terms
or if our commercial relationships do not result in the expected increased use
of our Web site.




                                       18
<PAGE>   19

    Additionally, our sale of automotive content, Web hosting and development
services and sales automation services to vehicle manufacturers and online
partners is dependent upon a few primary relationships, including competitive
online automotive car buying services and various vehicle manufacturers.

    We also depend on establishing and maintaining a number of commercial
relationships with high-traffic Web sites to increase traffic on Autoweb.com. We
currently have agreements with major Internet portals, such as America Online
and its related properties and Lycos. There is intense competition for
placements on these sites, and in the future we may not be able to enter into
distribution relationships on commercially reasonable terms or at all. Even if
we enter into distribution relationships with these Web sites, they themselves
may not attract significant numbers of consumers. Therefore, our Web site may
receive less than the number of additional consumers we expect from these
relationships. Moreover, we may have to pay significant fees to establish or
renew these relationships.

    We also depend on establishing and maintaining a number of commercial
relationships with other companies. Our current relationships include:

    -  New Car Test Drive and ASE, under which we purchase content for use by
       our consumers;

    -  America Online's Digital City, iWon.com, AutoNation, CarsDirect and
       Carprices, under which we share the revenue generated from automotive and
       related purchase inquiries submitted by consumers and directed to our Web
       site through links between our Web site and the other company's Web site;
       and

    -  members of the Autoweb.com Affiliates Program, each of which receives a
       commission from us for traffic or vehicle purchase inquiries delivered to
       us through a link to the affiliate's Web site.

    We cannot assure you that we will be able to establish new agreements or
    maintain existing agreements or that the above agreements can be renewed on
    commercially acceptable terms

    We also may not be able to maintain relationships with third parties that
supply us with software or products that are crucial to our success, and the
vendors of these software or products may not be able to sustain any third-party
claims or rights against their use. Furthermore, we cannot assure you that the
software, services or products of those companies that provide access or links
to our services or products will achieve market acceptance or commercial
success. In addition, we cannot assure you that our existing relationships will
result in sustained business arrangements, successful service or product
offerings or the generation of significant revenues for us. Failure of one or
more of our relationships to achieve or maintain market acceptance or commercial
success or the termination of one or more relationship could have a material
adverse effect on our business, results of operations and financial condition.

We need to continue to develop Autoweb.com content and service offerings

    To remain competitive, we must continue to enhance and improve the ease of
use, responsiveness, functionality and features of the Autoweb.com site and
develop new services in addition to continuing to improve the consumer
purchasing experience. These efforts may require the development or licensing of
increasingly complex technologies. We may not be successful in developing or
introducing new features, functions and services, and these features, functions
and services may not achieve market acceptance or enhance our brand loyalty. If
we fail to develop and introduce new features, functions or services
effectively, it could have a material adverse effect on our business, results of
operations and financial condition.

We are dependent on certain key personnel

    Our future success is substantially dependent on our senior management and
key technical personnel. If one or more of our key employees decided to leave
us, join a competitor or otherwise compete directly or indirectly with us, this
could have a material adverse effect on our business, results of operations and
financial condition. During the third and fourth quarters of 2000, we had
several senior management changes. Meri E. Glade joined the company in August
2000, as our Vice President, Legal Affairs and General Counsel and Steve
Cottrell joined the company in August 2000 as Vice President, Sales. Samuel
Hedgpeth, our President and Chief Executive Officer resigned and was replaced by
Jeffrey Schwartz, as President and Chief Executive Officer. Mr. Schwartz had
formerly served as our Vice President, Strategic Development. Michael Schmidt
joined the company in December 2000 as our Chief Financial Officer. Any
inability to reduce senior management turnover could have a material adverse
impact on our business, results of operations and financial condition.




                                       19
<PAGE>   20

    In addition, our future success depends on our continuing ability to retain
and attract highly qualified technical and managerial personnel. As of December
31, 2000, we had 152 full-time employees. Wages for managerial and technical
employees are increasing and are expected to continue to increase in the
foreseeable future due to the competitive nature of the current employment
market, particularly in Northern California, the location of our headquarters.
We may be unable to retain key technical and managerial personnel or to attract
and retain additional highly qualified technical and managerial personnel in the
future. We have experienced difficulty from time to time attracting the
personnel necessary to support the growth of our business, and we may experience
similar difficulty in the future. Inability to attract and retain the technical
and managerial personnel necessary to support the growth of our business could
have a material adverse effect upon our business, results of operations and
financial condition.

We face risks associated with possible regulation under state or federal
franchise and brokering laws

    In May 1998, the Texas Department of Transportation notified us that, in
their opinion, our performance-based pricing model is illegal, because it makes
us a broker as defined under Texas law. They have taken the position that the
fee paid to us by member dealers for each qualified purchase inquiry is
equivalent to a broker's fee and that we are arranging for two persons to meet
and enter into a transaction that involves the sale of a motor vehicle. In
September 1999 the Texas Department of Transportation sent a letter to the same
effect to our Texas member dealers, and as a result one of our largest member
dealer groups severed its business relationship with us. Shortly after the
Department's letter was sent to our Texas member dealers, we modified our
pricing model. To date the Department has taken no other action against us or
our member dealers based on our pricing model. A proposal to modify the
regulations governing how the Texas brokering law is enforced passed in February
2000. We have received written notice from the Texas Department of
Transportation that our newly revised pricing model conforms to the new
regulations.

    Other states, substantially all of which have laws that broadly define
brokerage activities, could determine that we are acting as a broker. If this
occurs, we may be required to comply with burdensome licensing requirements or
terminate our operations in those states. In either case, our business, results
of operations and financial condition could be materially and adversely
affected. We believe that our service does not qualify as a vehicle brokerage
activity and therefore that state broker licensing requirements do not apply to
us.

    In addition, government authorities may take the position that motor vehicle
dealer franchise laws or related consumer protection or product liability laws
apply to aspects of our business, including advertising vehicles on the
Internet. We do not believe our present business is subject to these laws,
however, we have not sought a legal opinion regarding whether our service
complies with the laws and regulations regarding motor vehicle dealer franchises
in each state.

We generally face risks associated with possible regulation under vehicle
insurance, financing or other laws

    State regulatory requirements may also include us within an
industry-specific regulatory scheme, such as those for the vehicle insurance or
vehicle financing industries. In the event that individual states' regulatory
requirements change or additional requirements are imposed on us, we may be
required to modify aspects of our business in those states in a manner that
might undermine the attractiveness of the Autoweb.com purchase process to
consumers, member dealers, vehicle manufacturers, category partners or
advertisers or require us to terminate operations in that state, either of which
could have a material adverse effect on our business, results of operations and
financial condition.

    Government authorities may take the position that state or federal insurance
licensing laws apply to aspects of our business. As we introduce new services
and expand our operations to other countries, we will need to comply with
additional licensing and regulatory requirements.

We are subject to U.S. government regulation of the Internet, the impact of
which is difficult to predict

    There are currently laws and regulations directly applicable to the
Internet. Some of these laws are currently in flux. The applications of existing
laws and regulations to Autoweb.com relating to issues such as user privacy,
defamation, pricing, taxation, promotions, content regulation, intellectual
property ownership and infringement can be unclear. In addition, we expect to be
subject to new laws and regulations directly applicable to our activities. Any
existing or new legislation applicable to us could expose us to substantial
liability, including significant expenses necessary to comply with such laws and
regulations.




                                       20
<PAGE>   21

    Several recently passed federal laws could have an impact on our affiliate
and other programs. The Digital Millennium Copyright Act is intended to limit
the liability of online services for listing or linking to third-party Web sites
that may include materials that infringe the copyrights or other rights of
others.

    We adhere to industry privacy policies and practices concerning the use and
disclosure of user data. There are a large number of legislative proposals
before the United States Congress and various state legislative bodies regarding
privacy issues related to our business. It is not possible to predict whether or
when such legislation may be adopted, and whether certain proposals, if adopted,
could materially and adversely affect our business.

We depend on increased use of the Internet

    Our future success and revenue growth depends substantially upon continued
growth in the use of the Internet. Consumers and businesses will likely widely
accept and adopt the Internet for conducting business and exchanging information
only if the Internet provides these consumers and businesses with greater
efficiencies and improvements in commerce and communication. In addition, e-
commerce generally, and the purchase of automotive and automotive related
products and services on the Internet in particular, must become widespread. The
Internet may prove not to be a viable commercial marketplace generally, or, in
particular, for vehicles and related products and services. If use of the
Internet does not continue to increase, our business, results of operations and
financial condition would be materially and adversely affected.

We depend on continued improvements in our systems and the Internet
infrastructure

    Our ability to retain and attract consumers, member dealers, vehicle
manufacturers, category partners and advertisers, and to achieve market
acceptance of our services and our brand, depends significantly upon the
performance of our systems and network infrastructure. Any system or network
failure that causes interruption or slower response time of our services could
result in less traffic to our Web site and, if sustained or repeated, could
reduce the attractiveness of our services to consumers, member dealers, category
partners and advertisers. An increase in the volume of our Web site traffic
could strain the capacity of our technical infrastructure, which could lead to
slower response times or system failures. This would cause the number of
purchase inquiries, advertising impressions, other revenue producing e-commerce
offerings and our information and community offerings to decline, any of which
could hinder our revenue growth and our brand loyalty. In addition, if traffic
increases, we cannot assure you that our technical infrastructure, such as a
reliable network backbone with the necessary speed and data capacity and the
development of complementary products such as high-speed modems, will be able to
increase accordingly, and we face risks related to our ability to scale up to
expected consumer levels while maintaining performance. Further, security and
authentication concerns regarding the transmission of confidential information
over the Internet, such as credit card numbers, may continue. Any failure of our
server and networking systems ability to handle current or higher volumes of
traffic would have a material adverse effect on our business, results of
operations and financial condition.

    The recent growth in Internet traffic has caused frequent periods of
decreased performance, requiring Internet service providers and users of the
Internet to upgrade their infrastructures. If Internet usage continues to
increase rapidly, the Internet infrastructure may not be able to support the
demands placed on it by this growth and its performance and reliability may
decline. If outages or delays on the Internet occur frequently, overall Internet
usage or usage of our Web site could increase more slowly or decline. Our
ability to increase the speed with which we provide services to consumers and to
increase the scope of such services is limited by and dependent upon the speed
and reliability of the Internet. Consequently, the emergence and growth of the
market for our services is dependent on future improvements to the entire
Internet.

    In addition, our operations depend upon our ability to maintain and protect
our computer systems, some of which are located at our corporate headquarters in
Santa Clara, California. We do have a backup disaster recovery program and fully
redundant systems for our service at an off-site location hosted by Exodus
Communications, Inc. While this offsite location does provide a significant
amount of security and scalability there is no guarantee that the system is not
vulnerable to damage from fire, floods, earthquakes, power loss,
telecommunications failures and similar events. Although we maintain insurance
against fires, floods, earthquakes and general business interruptions, the
amount of coverage may not be adequate in any particular case. The occurrence of
such an event could have a material adverse effect on our business, results of
operations and financial condition.




                                       21
<PAGE>   22

The Internet industry is characterized by rapid technological change

    Rapid technological developments, evolving industry standards and consumer
demands, and frequent new product introductions and enhancements characterize
the market for Internet products and services. These market characteristics are
exacerbated by the emerging nature of the market and the fact that many
companies are expected to introduce new Internet products and services in the
near future. Our future success will significantly depend on our ability to
continually improve the vehicle purchasing experience, the addition of new and
useful services and content to our Web site, and the performance, features and
reliability of our Web site. In addition, the widespread adoption of developing
multimedia-enabling technologies could require fundamental and costly changes in
our technology and affect the nature, viability and measurability of Internet-
based advertising, which could adversely affect our business, results of
operations and financial condition.

We could face liability for information retrieved from or transmitted over
the Internet and liability for products sold over the Internet

    We could be exposed to liability with respect to third-party information
that may be accessible through our Web site, links or car review services. Such
claims might assert, among other things, that, by directly or indirectly
providing links to Web sites operated by third parties, we should be liable for
copyright or trademark infringement or other wrongful actions by such third
parties through such Web sites. It is also possible that, if any third-party
content information provided on our Web site contains errors, consumers could
make claims against us for losses incurred in reliance on such information.

    We also enter into agreements with other companies under which any revenue
that results from the purchase of services through direct links to or from our
Web site is shared. Such arrangements may expose us to additional legal risks
and uncertainties, including local, state, federal and foreign government
regulation and potential liabilities to consumers of these services, even if we
do not provide the services ourselves. We cannot assure you that any
indemnification provided to us in our agreements with these parties, if
available, will be adequate.

    Even to the extent such claims do not result in liability to us, we could
incur significant costs in investigating and defending against such claims. The
imposition upon us for potential liability of information carried on or
disseminated through our system could require us to implement measures to reduce
our exposure to such liability, which might require the expenditure of
substantial resources or limit the attractiveness of our services to consumers,
member dealers, category partners and others.

    Our general liability insurance and our communications liability insurance
may not cover all potential claims to which we are exposed and may not be
adequate to indemnify us for all liability that may be imposed. Any imposition
of liability that is not covered by insurance or is in excess of insurance
coverage could have a material adverse effect on our business, results of
operations and financial condition.

Our intellectual property protection may be inadequate

    Legal standards relating to the validity, enforceability and scope of
protection of certain proprietary rights in Internet-related businesses are
uncertain and still evolving, and we can give no assurance regarding the future
viability or value of any of our proprietary rights. Despite the precautions we
have taken, it may be possible for a third party to copy or otherwise obtain and
use our proprietary information without authorization or to develop similar
technology independently.

    We have registered in the United States the "Autoweb" and "Autoweb.com"
trademarks associated with the services we provide and have registered the mark
"Autoweb" in a foreign jurisdiction. We are aware, however, that another party
has registered the "Autoweb" mark internationally. We cannot guarantee,
therefore, that we will be able to continue to use the name "Autoweb" or
"Autoweb.com" worldwide in the future. If we were required to change our name
and adopt a new trademark, we would incur significant expenses related to
marketing a replacement trademark, and such a change would likely have a
material adverse effect on our business, results of operations and financial
condition.

We face risks associated with litigation

    Litigation may be necessary in the future to enforce our intellectual
property rights, to protect our trade secrets or trademarks or to determine the
validity and scope of the proprietary rights of others. Such litigation might
result in substantial costs and diversion of resources and management attention.
Furthermore, our business activities may infringe upon the proprietary rights of
others and other parties may assert infringement claims against us, including
patent claims or claims that arise from directly or




                                       22
<PAGE>   23

indirectly providing hyperlink text links to Web sites operated by third
parties. Moreover, from time to time, we may be subject to claims of alleged
infringement by us or our member dealers of the trademarks, service marks,
patents and other intellectual property rights of third parties. Such claims and
any resultant litigation, should it occur, might subject us to significant
liability for damages, might result in invalidation of our proprietary rights
and, even if not meritorious, could result in substantial costs and diversion of
resources and management attention and have a material adverse effect on our
business, results of operations and financial condition.

We depend on third party technology

    We currently license from third parties certain technologies and information
incorporated into our Web site. As we continue to introduce new services that
incorporate new technologies and information, we may be required to license
additional technology and information from others. We cannot assure you that
these third-party technology and information licenses will continue to be
available to us on commercially reasonable terms, if at all. Additionally, we
cannot assure you that the third parties from which we currently license our
technology and information will be able to defend their proprietary rights
successfully against claims of infringement. Any failure to obtain any of these
technology and information licenses could result in delays or reductions in the
introduction of new features, functions or services. It could also adversely
affect the performance of our existing services until equivalent technology or
information can be identified, obtained and integrated.

We may particularly be affected by general economic conditions

    Purchases of new vehicles are typically discretionary for consumers and may
be particularly affected by negative trends in the general economy. The success
of our operations depends to a significant extent upon a number of factors
relating to discretionary consumer spending, including economic conditions (and
perceptions by consumers) affecting disposable consumer income (such as
employment, wages and salaries, business conditions, interest rates,
availability of credit and taxation) for the economy as a whole and in regional
and local markets where we operate. In addition, because the purchase of a
vehicle is a significant investment and is relatively discretionary, any
reduction in disposable income in general may affect us more significantly than
companies in other industries. In addition, our business strategy relies on
advertising by and agreements with other Internet companies. Any significant
deterioration in general economic conditions that adversely affects these
companies could also have a material adverse effect on our business, results of
operations and financial condition.

We have security risks

    On occasion, some experienced programmers ("hackers") have attempted to
penetrate our network security. We expect that these attempts, some of which
have succeeded, will continue to occur from time to time. Because a hacker who
penetrates our network security could misappropriate proprietary information or
cause interruptions in our services, we might be required to expend significant
capital and resources to protect against, or to alleviate, problems caused by
hackers. Additionally, we may not have a timely remedy against a hacker who is
able to penetrate our network security. In addition to purposeful security
breaches, the inadvertent transmission of computer viruses could expose us to
litigation or to a material risk of loss. Such security breaches and inadvertent
transmissions could have a material adverse effect on our business, results of
operations and financial condition.

    In offering certain online payment services, we may increasingly rely on
technology licensed from third parties to provide the security and
authentication necessary to effect secure transmission of confidential
information, such as consumer credit card numbers. Advances in computer
capabilities, new discoveries in the field of cryptography, or other events or
developments may result in a compromise or breach of the algorithms that we use
to protect our consumers' transaction data or our software vendors' products.
Any well-publicized compromise of security could deter use of the Internet in
general or use of the Internet to conduct transactions that involve transmitting
confidential information or downloading sensitive materials.

Power shortages in California may adversely affect us

    We conduct most of our operations in the state of California and rely on a
continuous power supply to conduct operations. California's current energy
crisis could substantially disrupt our operations and increase our expenses.
California has recently implemented, and may in the future continue to
implement, rolling blackouts throughout the state. Although state lawmakers are
working to minimize the impact, if blackouts interrupt our power supply, we may
be temporarily unable to continue operations at our facilities. Any such
interruption in our ability to continue operations at our facilities could delay
the development of our




                                       23
<PAGE>   24

products and disrupt communications with our customers, suppliers or
manufacturing operations. Future interruptions could damage our reputation and
could result in lost revenue, either of which could substantially harm our
business and results of operations. Furthermore, shortages in wholesale
electricity supplies have caused power prices to increase. If wholesale prices
continue to increase, our operating expenses will likely increase which will
have a negative effect on our operating results.

We have risks associated with international operations and expansions

    A part of our long-term strategy is to establish Autoweb.com and AIC in
international markets. However, the Internet, or our commerce, content and
community services model, may not become widely accepted in any market. In
addition, we expect that the success of any additional foreign operations we
initiate will be substantially dependent upon our member dealers, category
partners and content services. We may experience difficulty in managing
international operations as a result of failure to identify an effective foreign
partner, competition, technical problems, local laws and regulations, distance
and language and cultural differences. Our international partners may not be
able to successfully market and operate our community model in foreign markets.
There are also certain risks inherent in doing business internationally,
including:

    -  cultural and business practices differences;

    -  fluctuations in currency exchange rates;

    -  political issues;

    -  legal and economic instability;

    -  seasonal reductions in business activity in certain other parts of the
       world; and

    -  potentially adverse tax consequences.

    One or more of such factors could have a material adverse effect on our
future international operations and, consequently, on our business, results of
operations and financial condition.

Recent Accounting Pronouncements

    In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities." SFAS No. 133 is effective for all fiscal
quarters of all years beginning after June 15, 1999. SFAS No. 133 requires that
all derivative instruments be recorded on the balance sheet at their fair value.
Changes in the fair value of derivatives are recorded each period in current
earnings or other comprehensive income, depending on whether a derivative is
designed as part of a hedge transaction and, if it is, the type of hedge
transaction. In June 1999, the FASB issued SFAS No. 137, which delayed the
effective date of SFAS No. 133 to fiscal years beginning after June 15, 2000.
The adoption of SFAS No. 133 did not have a material impact on our financial
statements.


ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

    We considered the provisions of Financial Reporting Release No. 48,
"Disclosure of Accounting Policies for Derivative Financial Instruments and
Derivative Commodity Instruments, and Disclosure of Quantitative and Qualitative
Information about Market Risk Inherent in Derivative Financial Instruments,
Other Financial Instruments and Derivative Commodity Instruments." We had no
holdings of derivative financial or commodity instruments at December 31, 2000.
However, we are exposed to financial market risks, including changes in foreign
currency exchange rates and interest rates. The majority of our revenue,
expenses and capital expenditures are transacted in U. S. dollars.

    The objectives of our investment policy are the safety and preservation of
invested funds, and liquidity of investments that is sufficient to meet cash
flow requirements. Our policy is to place our cash, cash equivalents, and
investments available for sale with high credit quality financial institutions,
commercial companies, and government agencies in order to limit the amount of
credit exposure. Our investment policy also provides that our investment
portfolio must not have an average portfolio maturity of beyond one year and
that we must maintain liquidity positions. Our investment policy prohibits
investments in industries and speculative activities and requires investments be
denominated in U.S. dollars.


ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTAL DATA




                                       24
<PAGE>   25

    The Company's Financial Statements and Notes thereto are set forth in Part
IV, Item 14 of this Form 10-K.

Quarterly Financial Data

    The following tables summarize the quarterly financial data for the last two
fiscal years (in thousands, except per share data):

<TABLE>
<CAPTION>
                                                   FISCAL YEAR 2000 QUARTER ENDED
                                                   ------------------------------
                                         MARCH 31,     JUNE 30,   SEPTEMBER 30,  DECEMBER 31,
                                         ---------     --------   -------------  ------------
<S>                                      <C>           <C>        <C>            <C>
Net revenues ..........................  $ 15,794      $ 15,193      $ 11,509      $  9,784
Loss from operations ..................    (7,546)       (6,463)      (11,179)      (11,675)
Net loss ..............................    (7,228)       (6,000)      (10,779)      (14,363)
Basic and diluted net loss per share ..     (0.28)        (0.21)        (0.37)        (0.50)
</TABLE>

<TABLE>
<CAPTION>
                                                   FISCAL YEAR 1999 QUARTER ENDED
                                                   ------------------------------
                                         MARCH 31,     JUNE 30,   SEPTEMBER 30,  DECEMBER 31,
                                         ---------     --------   -------------  ------------
<S>                                      <C>           <C>        <C>            <C>
Net revenues ..........................  $  5,744      $  7,021      $  8,422      $ 11,605
Loss from operations ..................    (2,479)       (3,745)       (5,154)       (8,836)
Net loss ..............................    (2,440)       (2,954)       (4,350)       (8,409)
Basic and diluted net loss per share ..     (0.25)        (0.12)        (0.18)        (0.30)
</TABLE>


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

    None




                                       25
<PAGE>   26
                                    PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

EXECUTIVE OFFICERS AND DIRECTORS

     The following table sets forth specific information regarding our executive
officers and directors as of April 11, 2001.

<TABLE>
<CAPTION>
                  NAME OF DIRECTOR                      AGE                      PRINCIPAL OCCUPATION
<S>                                                     <C>       <C>
Dean A. DeBiase......................................   42        Chairman of the Board

Jeffrey A. Schwartz..................................   35        President, Chief Executive Officer and a Director

Michael F. Schmidt...................................   38        Chief Financial Officer

Nadyne G. Edison, Ph.D...............................   43        Chief Marketing Officer and Vice President, Customer
                                                                  Relationship Management

William J. Barrett...................................   44        Divisional President, Automotive Information Center
                                                                  (AIC)

Jerome S. Karr.......................................   53        Vice President, Engineering and Chief Technology
                                                                  Officer

Regan Senkarik.......................................   42        Vice President, Product Management

Steve Cottrell.......................................   40        Vice President, Sales

Fred L. Ruffin.......................................   50        Vice President, Human Resources

Meri E. Glade........................................   40        Vice President, Legal Affairs, General Counsel and
                                                                  Secretary

Jay C. Hoag(1).......................................   42        Director

Lawrence W. Lepard(1)................................   46        Director

Mark R. Ross(1)......................................   55        Director
</TABLE>

(1)  Member of the Audit Committee and the Compensation Committee

     Dean A. DeBiase has served as Chairman of the Board of Directors of
Autoweb since August 1999 and as a director since December 1998. He also
served as Chief Executive Officer from December 1998 to July 2000 and President
from December 1998 to November 1999. From March 1998 to December 1998, he was
the President of Start-Up-Partners, an Internet consulting company, where he
served as interim Chief Executive Officer and director of CatchTV, a
television/Web advertising and programming company. From January 1995 to March
1998, Mr. DeBiase was the President, Chief Executive Officer and a director of
Worldplay Entertainment, an online games and community company, which was a
wholly-owned subsidiary of America Online. From September 1993 to January 1995,
he was Vice President of Marketing of Zenith Electronics and Senior Vice
President of its Network Systems Division. Mr. DeBiase received a Bachelor of
Science degree in marketing from Northern Illinois University and a Masters in
Business Administration degree from the Keller Graduate School of Management.


                                       26
<PAGE>   27

     Jeffrey A. Schwartz has served as President and Chief Executive Officer and
as a director of Autoweb since November 2000. He previously served as the
Company's Vice President, Strategic Development from October 1999 to November
2000. From 1995 to October 1999, Mr. Schwartz held various positions at The Walt
Disney Company, including Corporate Vice President responsible for worldwide
corporate alliance business development. In this role, Mr. Schwartz was
responsible for executing the company's long-term strategic marketing,
promotional, advertising, and licensing relationships. During his tenure at
Disney, Mr. Schwartz held several positions inside of the corporate group and
was responsible for worldwide political affairs, governmental relations, and
various strategic business communications and representations functions. From
1993 to 1995, Mr. Schwartz was a principal of California Communications Group,
advising corporate, non-profit, and governmental clients. Mr. Schwartz received
Bachelor of Arts, Master of Arts, and Ph.D. degrees in Political Science from
the University of Southern California.

     Michael F. Schmidt has served as Chief Financial Officer of Autoweb
since December 2000. From May 2000 to October 2000, he was Chief Operating
Officer and Chief Financial Officer at MizBiz.com, an Internet startup. From
September 1999 to May 2000, Mr. Schmidt was Director of Finance at Pacificare
Health Systems, a health care company. From 1988 to March 1999, he held various
senior level positions at IMS Health, a worldwide provider of information
services. At IMS Health, he served as both Chairman of the Amfac Chemdata Group
and as Director of Financial Analysis. Mr. Schmidt received a Bachelors of
Business Administration and Accounting from Cleveland State University and
earned his CPA certificate in the State of Ohio.

     Nadyne G. Edison, Ph.D. has served as Chief Marketing Officer and Vice
President, Customer Relationship Management of Autoweb since July 2000. From
1996 to 2000, she served as Vice President of Strategic Development for
Automotive CRM at EDS, Inc., a professional services company. From 1995 to 1996,
she was Director of New Media Marketing at General Motors Corporation, an auto
manufacturer. Dr. Edison has extensive experience developing CRM strategies for
vehicle manufacturers and dealers to better serve and interact with online
automotive consumers. In 1996 while at General Motors, she launched gm.com, a
fully integrated Web site linking corporate, divisional and retail sites. From
1985 to 1992, Dr. Edison created and served as the first executive director of
the Mayor's Office of Film, Television and New Business Development for the City
of Detroit. From 1979 to 1982, she was a professor of Mass Communication at New
York University. From 1992 to 1995, she was president of her own marketing
communications firm Edison Communications where she consulted with major Fortune
500 companies in the automotive, entertainment and communication industries. Dr.
Edison received Doctorate and Masters degrees in Communication from Michigan
State University, and a Bachelor of Arts degree in Communication from Queens
College.

     William J. Barrett has served as Divisional President, Automotive
Information Center (AIC) of Autoweb since June 2000. From June 1994 to May
2000, Mr. Barrett was managing director of dealer/regional programs within the
Transportation Information Services group at The Polk Company where he was
chartered with developing Polk's Internet and e-Commerce strategy for the
automotive dealer marketplace. In this capacity he led a product development and
management team as well as a sales and marketing team that was focused on
delivering information-based products and services to automotive retailers and
related companies throughout the U.S. He also led the development of Polk's
strategic planning process for the Transportation Group. Before joining Polk,
Mr. Barrett held a variety of marketing and sales management positions at
leading information services, software publishing and business products firms,
including Automatic Data Processing (ADP), Herman Miller Inc. and Moore Business
Forms. Mr. Barrett received a Bachelor of Business Administration degree from
Eastern Michigan University and a Masters in Business Administration degree from
Fontbonne University.

     Jerome S. Karr has served as Vice President, Engineering and Chief
Technology Officer of Autoweb since April 2000. From 1994 to 2000, Mr. Karr
was Vice President, Business Process Engineering for EDS/Mitsubishi, a
semiconductor manufacturer and distributor. While there, he built up and staffed
the IT function from scratch and installed SAP after engineering several
business processes. From 1987 to 1994, Mr. Karr was Director of Business
Development and Legal Services for Fujitsu Microelectronics, Inc., a
semiconductor manufacturer and distributor. He has held a number of MIS, finance
and marketing management positions with leading high technology companies,
including Meicor, Zymos Corporation, Androbot, Inc., Trilogy Systems Corporation
and Amdahl Corporation. Mr. Karr received a Bachelor of Science degree in
Systems Analysis & Design Engineering from the University of Illinois and a
Masters in Business Administration degree from the University of Chicago.


                                       27
<PAGE>   28

     Regan Senkarik has served as Vice President, Product Management of
Autoweb since September 2000. She also served as General Manager, Core
Products from March 1999 to September 2000. From January 1999 to February 1999,
Ms. Senkarik was Vice President of Multi-Media Development for Wadsworth
Publishing, an academic publisher. From 1983 to 1999, she held various positions
with the Dialog Corporation, an online information company, most recently as
Vice President and General Manager for the CD-ROM Division. Ms. Senkarik
received a Bachelor of Arts degree in economics from the University of
California, Los Angeles.

     Steve Cottrell has served as Vice President, Sales of Autoweb since
September 2000. From 1992 to 2000, Mr. Cottrell was North American Marketing
Manager for HAC Group LLC, a leading global provider of training, customer
relationship management, and Web services to automotive retailers and
manufacturers. While at HAC, he facilitated a team that developed and delivered
the "Coaching 2000" program curriculum for dealer principals, general managers,
and sales managers, and also was a consultant for General Motors Corporation and
Ford Motor Company's New Media Group on various e-business initiatives and
projects. Prior to joining HAC, Mr. Cottrell spent fourteen years in automotive
dealership retail sales management, including positions as Team Leader for
Saturn of Modesto and General Sales Manager for a large-volume Ford dealership
in California's Central Valley.

     Fred L. Ruffin has served as Vice President, Human Resources of Autoweb
since January 2000. From June 1994 to January 2000, Mr. Ruffin was Vice
President, Eastfield Ming Quong, Inc., a non-profit company. Prior to this, he
served as Vice President, Human Resources and Director, Human Resources for
Digital F/X, Inc. from July 1989 to June 1994. Previously, from November 1986 to
July 1989, Mr. Ruffin served as Manager, Human Resources at Digital Equipment
Corp, a computer company. From October 1984 to November 1986, he served as
Director, Human Resources at Trilogy Corp, a software company subsequently
acquired by Digital Equipment Corp. From November 1980 to October 1984, he
served as Director, Human Resources at Genentech, Inc., a biotechnology company.
Previously, from June 1976 to November 1980, Mr. Ruffin served as Director,
Corporate Staff Industrial Relations at Memorex Corp., a consumer electronics
company. Mr. Ruffin received a Bachelor of Arts degree in Psychology and
Industrial Relations from San Francisco State University.

     Meri E. Glade has served as General Counsel and Secretary of Autoweb
since September 2000. From 1998 to August 2000, she served as General Counsel
for Speedlink LLC, a voice, data and video Internet communications provider and
CLEC with operations in San Jose, California and Bend, Oregon. From 1988 to
1991, Ms. Glade was an associate with the law firm of Brobeck, Phleger &
Harrison, San Francisco. She also held positions as senior counsel for the
Judicial Council of California and the California Supreme Court Committee on
Judicial Ethics from 1993 to 1998. She was appointed under the Bush
Administration as attorney advisor to the United States Environmental Protection
Agency from 1991 to 1992, conducting a year-long study of transactional costs
related to the clean up of SuperFund sites in Region IX. Ms. Glade received a
Bachelor of Arts degree in Political Science with honors from the University of
California-Santa Barbara and a Juris Doctor of Law degree from the University of
San Francisco. She is an active member of the State Bar of California.

     Jay C. Hoag has been a director of Autoweb since May 1998. Since June
1995, Mr. Hoag has been a General Partner of Technology Crossover Ventures, a
venture capital firm. From 1982 to December 1994, Mr. Hoag served in a variety
of capacities at Chancellor Capital Management, Inc. Mr. Hoag currently serves
on the board of directors of eLoyalty, a customer loyalty solutions company, EXE
Technologies, an inventory management solutions company, and Expedia.com, a
consumer travel Internet service. He received a Bachelor of Arts degree in
Economics and Political Science from Northwestern University and a Masters in
Business Administration degree from the University of Michigan.

     Lawrence W. Lepard has been a director of Autoweb since October 2000.
Mr. Lepard is the Managing General Partner of Geocapital Partners, L.L.C., a
venture capital firm. Prior to joining Geocapital, Mr. Lepard was a Partner at
Summit Ventures. He also served as Chief Financial Officer of Calay Systems and
as an Investment Associate at Continental Illinois Venture Corporation, a
subsidiary of Continental Illinois Bank & Trust. Mr. Lepard has served on the
boards of directors of numerous public and private information technology based
firms and is presently a Director of several privately held companies. Mr.
Lepard received a Bachelor of Arts degree in economics from Colgate University
and an M.B.A. with Distinction from Harvard Business School.


                                       28
<PAGE>   29

     Mark R. Ross has been a director of Autoweb since July 1996. Since 1999
Mr. Ross has been a Managing Director of Chatsworth Securities, L.L.C., an
investment firm headquartered in Greenwich, CT. Since May 1996, Mr. Ross has
also been Managing Director of Cogito Capital Partners, L.L.C., a merchant bank
focusing on investing in and raising funds for Internet companies. Mr. Ross has
served on the board of advisors of numerous Internet companies, including
iCastle.com and MediaPlex, Inc. Since May 1984, Mr. Ross has served as
President, Chief Executive Officer and a director of On Word Information, Inc.
He received a Bachelor of Science degree in finance from Lehigh University and
studied at the graduate level in education at the University of Massachusetts.


BOARD OF DIRECTORS

     The Board of Directors of the Company presently consists of six members and
is divided into three equal classes with one vacancy. Each class serves three
years, with the terms of office of the respective classes expiring in successive
years. The terms of office of directors in Class I, Class II and Class III do
not expire until the annual meetings of stockholders held in 2003, 2001 and
2002, respectively.

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

     Section 16 of the Exchange Act requires the Company's directors and
officers, and persons who own more than 10% of a registered class of the
Company's equity securities, to file initial reports of ownership and reports of
changes in ownership with the Commission. Such persons are required by
regulation to furnish the Company with copies of all Section 16(a) forms they
file.

     Based solely on its review of the copies of such forms furnished to the
Company and written representations from the executive officers and directors of
the Company, the Company believes that all Section 16(a) filing requirements
were met during 2000, except that one Form 3, reporting no transactions, for
William Barrett was filed late, one Form 4, reporting two transactions, for
William Barrett was filed late, one Form 3, reporting one transaction, for Steve
Cottrell was filed late, one Form 3, reporting two transactions, for Sandra
Craig was filed late, one Form 3, reporting one transaction, for Meri Glade was
filed late, one Form 4, reporting two transactions, for David Greene was filed
late, one Form 3, reporting eight transactions, for Brian Hafer was filed late,
one Form 3, reporting two transactions, for Jerome Karr was filed late, one Form
3, reporting no transactions, for Lawrence Lepard was filed late, one Form 4,
reporting one transaction, for Mark Ross was filed late, one Form 3, reporting
no transactions, for Fred Ruffin was filed late, one Form 3, reporting one
transaction, for Eric Rucker was filed late, one Form 3, reporting no
transactions, for Michael Schmidt was filed late, one Form 5, reporting three
transactions, for Robert Shapiro was filed late, one Form 4, reporting two
transactions, for Robert Shapiro was filed late, one Form 3, reporting six
transactions, for Patrick Stanton was filed late, one Form 5, reporting three
transactions, for Thomas Stone was filed late, one Form 3, reporting four
transactions, for James Wolfe was filed late and one Form 5, reporting an
aggregate of eighteen transactions for three late Forms 4 and one late Form 5,
for Payam Zamani was filed late.


                                       29
<PAGE>   30
ITEM 11. EXECUTIVE COMPENSATION


     The following table sets forth all compensation awarded to, earned by or
paid for services rendered to us in all capacities during 1998, 1999 and 2000 by
all individuals serving as Chief Executive Officer during 2000 and our four most
highly compensated executive officers who were serving as executive officers at
the end of 2000 and two executive officers who resigned during 2000 (each, a
"Named Executive Officer").

                           SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
                                                                                                          LONG-TERM
                                                                                     ANNUAL              COMPENSATION
                                                                   YEAR           COMPENSATION              AWARDS
                                                                   ----           ------------           ------------
                                                                                                          SECURITIES
                                                                                                          UNDERLYING
                NAME AND PRINCIPAL POSITION                                 SALARY($)        BONUS($)     OPTIONS(#)
                ---------------------------                                 ---------        --------     ----------
<S>                                                                <C>       <C>             <C>          <C>
Dean A. DeBiase(1)..........................................       2000      250,000         114,750              --
         Chairman of the Board and former Chief Executive          1999      250,000         100,000              --
         Officer
                                                                   1998           --              --       1,780,476

Samuel M. Hedgpeth III(1)...................................       2000      250,000         137,031          80,000
         Former President and Chief Executive Officer              1999      166,875          36,000         304,987
                                                                   1998      140,833          36,101          60,883

Jeffrey A. Schwartz (2).....................................       2000      191,666          67,717          70,000
         President and Chief Executive Officer                     1999       34,391              --         155,000
                                                                   1998           --              --              --

Regan Senkarik (3)..........................................       2000      153,703          23,408          77,500
         Vice President, Product Management                        1999       88,080          10,000          65,000
                                                                   1998           --              --              --

Fred L. Ruffin..............................................       2000      152,740          23,443         130,000
         Vice President, Human Resources                           1999           --              --              --
                                                                   1998           --              --              --

Nadyne G. Edison, Ph.D......................................       2000      112,500          42,250         220,000
         Chief   Marketing   Officer  and  Vice   President,       1999           --              --              --
         Customer Relationship Management                          1998           --              --              --

Jerome S. Karr..............................................       2000      132,687          12,229         135,000
         Vice President, Engineering and Chief Technology          1999           --              --              --
         Officer                                                   1998           --              --              --

Thomas L. Stone (4).........................................       2000      217,979          65,531          45,000
         Former Vice President, Corporate Strategy                 1999       90,625          10,000         116,500
                                                                   1998       67,046             108          13,500

David L. Greene (5).........................................       2000      253,310          33,162          12,332
         Former Vice President, Sales and Dealer Network           1999      144,000          90,018          47,107
         Operations                                                1998      110,032          66,121          52,893
</TABLE>


                                       30
<PAGE>   31
------------------
(1)  Dean A. DeBiase served as Chief Executive Officer from January 2000 to July
     2000 and Samuel M. Hedgpeth III served as Chief Executive Officer from July
     2000 to November 2000. Jeffrey A. Schwartz became our Chief Executive
     Officer in November 2000.
(2)  Jeffrey Schwartz began employment with the Company in October 1999.
(3)  Regan Senkarik began employment with the Company in March 1999.
(4)  Thomas Stone resigned as an Executive Officer during November 2000.
(5)  David Greene resigned as an Executive Officer during November 2000.



                              OPTION GRANTS IN 2000

The following Named Executive Officers received grants of options in 2000.
<TABLE>
<CAPTION>
                                                                                                  POTENTIAL REALIZABLE
                                                             PERCENTAGE                          VALUE AT ASSUMED ANNUAL
                                                NUMBER OF     OF TOTAL                            RATES OF STOCK PRICE
                                                SECURITIES    OPTIONS     EXERCISE               APPRECIATION FOR OPTION
                                                UNDERLYING   GRANTED TO    PRICE                          TERM(4)
                                                 OPTIONS     EMPLOYEES      PER      EXPIRATION           -------
                     NAME                       GRANTED(1)   IN 2000(2)   SHARE(3)      DATE         5%           10%
                     ----                       ----------   ----------   --------      ----         --           ---
<S>                                              <C>           <C>       <C>         <C>          <C>         <C>
Dean A. DeBiase...............................        --           --%    $    --          --     $     --    $     --
Samuel M. Hedgpeth III........................    80,000        2.8375     3.2500     5/12/10      163,513       414,373
Jeffrey A. Schwartz (5).......................    70,000        2.4828     3.2500     5/12/10      143,074       362,576
Regan Senkarik................................    32,500        1.1527     3.2500     5/12/10       66,427       168,339
                                                  45,000        1.5961     0.8750    10/18/10       24,763        62,754
Fred L. Ruffin................................    75,000        2.6602     9.1250     1/31/10      430,400     1,090,717
                                                  25,000        0.8867     3.9375     4/19/10       61,907       156,884
                                                  30,000        1.0641     3.2500     5/12/10       61,317       155,390
Nadyne G. Edison, Ph.D. (6)...................   220,000        7.8031     2.1875      7/3/10      302,656       766,988
Jerome S. Karr................................   135,000        4.7883     3.8750     4/24/10      328,991       833,727
Thomas L. Stone...............................    45,000        1.5961     3.2500     5/12/10       91,976       233,085
David L. Greene...............................    12,332        0.4374     3.2500     5/12/10       25,205        63,876
</TABLE>
------------------

(1)  All options are either incentive stock options or nonqualified stock
     options and generally vest monthly over four years from the issuance date
     at the rate of 2.0833% of the shares per month, except that no shares vest
     until the optionee's first anniversary of employment, at which time a
     number of shares equal to 2.0833% of the shares multiplied by the number of
     months between issuance and the optionee's first anniversary of employment
     become vested. Options expire ten years from the date of grant, subject to
     earlier termination upon termination of employment.
(2)  Based on options to purchase a total of 2,819,381 shares of common stock
     granted during 2000.
(3)  Options were granted at an exercise price equal to the fair market value of
     our common stock on grant date.
(4)  Potential realizable values are computed by (a) multiplying the number of
     shares of common stock subject to a given option by the market price of
     such option on the date of grant, (b) assuming that the aggregate stock
     value derived from that calculation compounds at the annual 5% and 10%
     rates shown in the table for the entire ten-year term of the option and (c)
     subtracting from the result the aggregate option exercise price. The 5% and
     10% assumed annual rates of stock price appreciation are mandated by the
     rules of the Securities and Exchange Commission and do not represent our
     estimate or projection of future common stock prices.
(5)  Jeffrey Schwartz's options vested 10% on the date of grant, with an
     additional 15% of the remaining balance upon the first anniversary of the
     grant date, and the balance thereafter vests at a rate of 2.0833% monthly
     over 3 years.


                                       31
<PAGE>   32
(6)  Nadyne Edison's options vested 20% on the date of grant, with an additional
     5% of the remaining balance vesting upon the first anniversary after the
     grant date, and the balance thereafter vests at a rate of 2.0833% monthly
     over 3 years.

       AGGREGATE OPTION EXERCISES IN 2000 AND VALUES AT DECEMBER 31, 2000

     The following table sets forth the number of shares acquired and the value
realized upon exercise of stock options during 2000 and the number of shares of
common stock subject to exercisable and unexercisable stock options held as of
December 31, 2000 by each Named Executive Officer. Also reported are values of
"in-the-money" options, which represent the positive spread between the
respective exercise prices of outstanding stock options and $0.25, the closing
price per share of our common stock on December 31, 2000.

<TABLE>
<CAPTION>
                                                                       NUMBER OF SECURITIES         VALUE OF UNEXERCISED
                                        NUMBER OF                     UNDERLYING UNEXERCISED        IN-THE-MONEY OPTIONS
                                          SHARES                   OPTIONS AT DECEMBER 31, 2000    AT DECEMBER 31, 2000(2)
                                       ACQUIRED ON      VALUE      ----------------------------  --------------------------
NAME                                    EXERCISE     REALIZED(1)   EXERCISABLE    UNEXERCISABLE  EXERCISABLE  UNEXERCISABLE
----                                    ---------    -----------   -----------    -------------  -----------  -------------
<S>                                       <C>        <C>               <C>            <C>              <C>            <C>
Dean A. DeBiase.......................         --    $                 527,050        507,766           --             --
Samuel M. Hedgpeth III................         --            --        296,737        283,261           --             --
Jeffrey A. Schwartz...................         --            --         55,417        169,583           --             --
Regan Senkarik........................         --            --         28,074        114,426           --             --
Fred L. Ruffin........................         --            --             --        130,000           --             --
Nadyne G. Edison Ph.D. ...............         --            --         45,714        174,286           --             --
Jerome S. Karr........................         --            --             --        135,000           --             --
Thomas L. Stone.......................         --            --         29,631             --           --             --
David L. Greene.......................     10,000        24,375          9,081             --           --             --
</TABLE>
------------------
(1)  "Value Realized" represents the fair market value of the shares of common
     stock underlying the option on the date of exercise, less the aggregate
     exercise price of the option.

(2)  The options that are the subject of this table are not in-the-money.

DIRECTOR COMPENSATION

     Our directors do not receive cash compensation for their services as
directors but are reimbursed for their reasonable and necessary expenses for
attending board and board committee meetings. Members of the Board of Directors
who are not employees of Autoweb, or any parent, subsidiary or affiliate of
Autoweb, are eligible to participate in the Company's 1999 Directors Stock
Option Plan unless they are representatives of venture capital funds or
corporate investors.

     In January 1999, the Board of Directors adopted, and in March 1999 our
stockholders approved, the 1999 Directors Stock Option Plan. We have reserved a
total of 150,000 shares of common stock for issuance under the directors' plan.
Members of the Board of Directors who are not employees of Autoweb, or any
parent, subsidiary or affiliate of Autoweb, will be eligible to participate in
the directors plan unless they are representatives of venture capital funds or
corporate investors. The option grants under the directors' plan are automatic
and nondiscretionary, and the exercise price of the options must be 100% of the
fair market value of the common stock on the date of grant. Each eligible
director who becomes a member of the Board of Directors will initially be
granted an option to purchase 15,000 shares (an "Initial Grant") on the date the
director first becomes a director. Immediately following each annual meeting of
our stockholders, each eligible director will automatically be granted an
additional option to purchase 7,500 shares if the director has served
continuously as a member of the Board of Directors since the date of the
director's Initial Grant. The term of these options is ten years, provided that
they will terminate seven months following the date the director ceases to be a
director or a consultant of Autoweb or 12 months if the termination is due to
death or disability. All options granted under the directors plan will vest over
four years at a rate of 2.08% per month, provided the optionee


                                       32
<PAGE>   33
continues as a member of the Board of Directors or as a consultant to Autoweb.
In the event of our dissolution or liquidation or a "change in control"
transaction, options granted under the directors plan will become 100% vested
and exercisable in full.

EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
ARRANGEMENTS.

     Under the terms of an offer letter between the Company and Dean DeBiase,
dated December 16, 1998, as amended March 30, 2001, if Mr. DeBiase is terminated
for any reason other than cause, he will receive a lump sum payment equal to one
year of his then current salary and may continue to participate in certain
retirement, medical and other plans for one year following his termination. In
the event of a change of control of Autoweb, 75% of Mr. DeBiase's unvested stock
options or restricted stock will be immediately exercisable. Furthermore, if
within one year following a change of control of Autoweb, Mr. DeBiase's
employment is terminated for any reason other than cause or he terminates his
employment for good reason, in addition to the termination benefits mentioned
above, any unvested stock options or restricted stock will be immediately
exercisable, and he will receive an amount equal to a pro-rated bonus.

    On November 5, 1999, we entered into an employment agreement with Samuel
Hedgpeth. In the event Mr. Hedgpeth was terminated for any reason other than
cause, Mr. Hedgpeth would receive severance payments at his then current salary
rate and benefits for the nine month period following his termination, plus
compensation and benefits earned through his date of termination, and 75% of his
unvested stock options would become immediately exercisable. In the event of a
change of control, 75% of any unvested options would become immediately
exercisable if Mr. Hedgpeth was not retained by the acquiring company. Mr.
Hedgpeth resigned his positions as President and Chief Executive Officer in
November 2000.

     In May 2000, the Board of Directors adopted a Change of Control Benefit
Plan, or COC Plan. Upon a change of control of Autoweb, the vesting of 75% of
the stock underlying any stock options or restricted stock held by participants
will accelerate. In the event the participant is terminated without cause or
terminates their employment for good reason, within one year following a change
of control of Autoweb, any unvested stock options or restricted stock will be
immediately exercisable. In addition, the participant will receive a cash lump
sum payment equal to any unpaid base salary plus an amount equal to a pro-rated
bonus and an amount equal to one year of their base salary multiplied by their
severance multiple. In January 2001, Jeffrey Schwartz, Regan Senkarik, Fred
Ruffin, Nadyne Edison, Jerome Karr and other executive officers elected to
become participants in the COC Plan.


COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

     None of the members of the Compensation Committee of the Board of Directors
has at any time since our formation been an officer or employee of Autoweb. No
executive officer of Autoweb serves as a member of the board of directors or
compensation committee of any entity that has one or more executive officers
serving on our board of directors or compensation committee.


                                       33
<PAGE>   34
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The following table sets forth certain information known to us with respect
to beneficial ownership of our common stock as of March 31, 2001 by (1) each
stockholder known by us to be the beneficial owner of more than 5% of our common
stock, (2) each of our directors, (3) each Named Executive Officer (as defined
under "Executive Compensation" below) and (4) all current executive officers and
directors as a group.

<TABLE>
<CAPTION>
                                                                            SHARES BENEFICIALLY
                                                                                  OWNED(1)
NAME OF BENEFICIAL OWNER                                                    NUMBER       PERCENT
------------------------                                                    ------       -------
<S>                                                                         <C>            <C>
Lawrence W. Lepard
   Geocapital IV, L.P.(2).............................................      3,416,842      11.6
   2 Executive Drive, Suite 820
   Fort Lee, New Jersey 07024
Lycos, Inc.(3)........................................................      3,035,025      10.3
Jay C. Hoag
   Technology Crossover Ventures(4)...................................      2,715,323       9.2
   528 Ramona Street, #400
   Palo Alto, California 94301
Payam Zamani(5).......................................................      2,205,930       7.5
Mark R. Ross
   On Word Information, Inc.(6).......................................      2,183,251       7.4
   1644 Warnall Avenue
   Los Angeles, California 90024
Dean A. DeBiase(7)....................................................      1,229,494       4.1
Samuel M. Hedgpeth III(8) ............................................        185,011         *
Jeffrey A. Schwartz(9)................................................         92,355         *
Jerome S. Karr(10)....................................................         55,532         *
Nadyne G. Edison, Ph.D.(11) ..........................................         45,714         *
Regan Senkarik(12)....................................................         42,915         *
Fred L. Ruffin(13)....................................................         35,917         *
Thomas L. Stone(14)...................................................          2,500         *
David L. Greene(15)...................................................          2,500         *
All directors and executive officers as a group (13 persons)(16) .....      9,881,093      33.5
</TABLE>
------------------

*    Represents beneficial ownership of less than 1%.

(1)  Beneficial ownership is determined in accordance with the rules of the
     Securities and Exchange Commission and generally includes voting or
     investment power with respect to securities. Unless otherwise indicated
     below, the persons and entities named in the table have sole voting and
     sole investment power with respect to all shares beneficially owned,
     subject to community property laws where applicable. Shares of common stock
     subject to options that are currently exercisable or exercisable within 60
     days of March 31, 2001 are deemed to be outstanding and to be beneficially
     owned by the person holding such options for the purpose of computing the
     percentage ownership of such person but are not treated as outstanding for
     the purpose of computing the percentage ownership of any other person.
(2)  All of the shares are held of record by Geocapital IV, L.P., its sole
     general partner Geocapital IV Management, L.P. and Geocapital IV
     Management, L.P.'s general partners, Stephen J. Clearman, Lawrence W.
     Lepard and Richard A. Vines. Mr. Lepard is one of our directors. Each
     beneficial owner shares voting and dispositive power with respect to the
     all of the shares. Geocapital IV Management, L.P., Stephen J. Clearman,
     Lawrence W. Lepard and Richard A. Vines each expressly disclaims beneficial
     ownership, except to the extent of its or his pecuniary interest therein,
     if any. The address of Geocapital IV, L.P. is One Bridge Plaza, Fifth
     Floor, Fort Lee, New Jersey 07024.
(3)  All of the shares are held of record by Lycos, Inc. The address of Lycos,
     Inc. is 400-2 Totten Pond Road, Waltham, Massachusetts 02451.
(4)  Represents 1,298,940 shares held of record by Technology Crossover Ventures
     II, L.P., 998,643 shares held of record by TCV II (Q), L.P., 198,322 shares
     held of record by Technology Crossover Ventures II, C.V., 177,223 shares
     held of record by TCV II Strategic Partners, L.P. and 42,195 shares held of
     record by TCV II, V.O.F. Mr. Hoag, one of our directors, is a managing
     member of Technology Crossover Management II, L.L.C., the general partner
     of Technology Crossover Ventures. Mr. Hoag has shared voting and investment
     power over all of these

                                       34
<PAGE>   35

     shares and he disclaims beneficial ownership of these shares except to the
     extent of his pecuniary interest in such shares arising from his interest
     in Technology Crossover Management II, L.L.C. The address for Mr. Hoag,
     Technology Crossover Ventures II, L.P., TCV II (Q), L.P., TCV II Strategic
     Partners, L.P., Technology Crossover Management II, L.L.C. is Technology
     Crossover Ventures, 528 Ramona Street, Palo Alto, CA 94301. The address of
     Technology Crossover Ventures II, C.V. and TCV II, V.O.F. is Pietermaai 15,
     Willemstad, Curacao, Netherlands Antilles.
(5)  Mr. Payam Zamani is a co-founder and former executive officer and director
     of the company. Mr. Zamani resigned his executive officer and director
     positions with the company during 1999. Mr. Zamani's address is
     Purpletie.com, 4780 Chabot Drive, Second Floor, Pleasanton, CA 94588.
(6)  Represents 1,864,863 held of record by On Word Information, Inc., 84,906
     shares held of record by Mark Ross' wife and 94,967 shares held of record
     by Mark Ross. The address of Mark Ross, one of our directors, and On Word
     Information, Inc. is 1644 Warnall Avenue, Los Angeles, CA 90024. Also
     represents shares held of record by John Rhys-Davies in the amount of
     81,000. John Rhys-Davies is a director of OnWord Information, Inc.
(7)  Includes 632,834 shares subject to options that are exercisable within 60
     days of March 31, 2001 and 52,500 shares held by the Dean A. DeBiase, Jr.
     Trust and 52,500 shares held by the Logan P. DeBiase Trust. Mr. DeBiase
     disclaims beneficial ownership of the 105,000 shares held by the Dean A.
     DeBiase, Jr. Trust and the Logan P. DeBiase Trust. Mr. DeBiase is our
     Chairman of the Board and former Chief Executive Officer. Mr. DeBiase
     resigned his Chief Executive Officer position with the company during 2000.
     His address is c/o Autoweb.com, Inc., 3270 Jay Street, Santa Clara,
     California 95054.
(8)  Mr. Hedgpeth resigned his President and Chief Executive Officer positions
     during November 2000.
(9)  Includes 91,355 shares subject to options that are exercisable within 60
     days of March 31, 2001.
(10) Includes 36,532 shares subject to options that are exercisable within 60
     days of March 31, 2001.
(11) Includes 45,714 shares subject to options that are exercisable within 60
     days of March 31, 2001.
(12) Includes 42,915 shares subject to options that are exercisable within 60
     days of March 31, 2001.
(13) Includes 35,917 shares subject to options that are exercisable within 60
     days of March 31, 2001.
(14) Mr. Stone resigned as an Executive Officer during November 2000.
(15) Mr. Greene resigned as an Executive Officer during November 2000.
(16) Includes 954,017 shares subject to options exercisable within 60 days of
     March 31, 2001.


                                       35
<PAGE>   36
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     From January 1, 2000 to the present, there have been no currently proposed
transactions in which the amount involved exceeds $60,000 to which the Company
or any of its subsidiaries was (or is to be) a party and in which any executive
officer, director, 5% beneficial owner of the Company's common stock or member
of the immediate family of any of the foregoing persons had (or will have) a
direct or indirect material interest, except for compensatory payments disclosed
where required under "Executive Compensation" above and the transactions
described below.

     Officer Loans. In January 1999, Dean DeBiase, our Chairman and Chief
Executive Officer, borrowed an aggregate of $921,982 from us pursuant to three
full-recourse, three-year, interest free promissory notes in the amounts of
$100,000, $686,396 and $135,586 in connection with the exercise of his options
to purchase 199,999 shares of common stock and 395,661 shares of our Series D
Preferred Stock. The $100,000 note is secured by the 199,999 shares of common
stock purchased and the $636,396 and $135,586 promissory notes are each secured
by the 395,661 shares of common stock into which the purchased Series D
Preferred Stock automatically converted at the time of our initial public
offering. As of March 31, 2001, the full $921,982 continued to remain
outstanding. At September 30, 2000, the Company had full recourse promissory
notes receivable in the amount of approximately $960,000, approximately $922,000
of which is from Dean DeBiase, our Chairman and approximately $38,000 of which
is from Samuel Hedgpeth, our former President and Chief Executive Officer.

     Lycos, Inc. Agreement. In March 2000, the Company and Lycos, Inc. entered
into a four year agreement under which a co-branded version of the Autoweb Web
site would be accessible across Lycos' network and all its Web properties. Major
elements of the Agreement included regularly scheduled payments to Lycos for
impressions, integration, and exclusivity. The amount of payments to Lycos over
four years under this Agreement totaled $32 million. The Agreement called for a
split of net advertising revenue on the co-branded site that was tiered by the
amount of gross revenue and varied from year to the year. Autoweb also received
a percentage of revenue from the placement of advertising on the Lycos Network
in areas and on properties other than the co-branded site for customers that
Autoweb referred to Lycos. Lycos shared in a fixed amount of revenue per
transaction from those transactions on the co-branded site, if any, above a
minimum threshold dollar amount in total. In April 2000, in connection with the
Agreement, Lycos acquired 3,035,025 shares of the Company's common stock for
$21,846,110.

     On March 21, 2001, the four year agreement was terminated by mutual consent
and a final payment of $13.3 million was paid to Lycos in settlement of the
Company's then-outstanding commitments. On April 2, 2001, the Company and Lycos
entered into new three year nonexclusive agreement to receive certain content
and customer referrals from the co-branded site, along with certain advertising
revenue generated from the co-branded site.
<PAGE>   37

                                     PART IV

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

    (a) The following documents are filed as part of this report:

    1. Financial Statements


                          INDEX TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
                                                                          PAGE
                                                                          ----
<S>                                                                       <C>
Report of Independent Accountants......................................    38
Balance Sheets.........................................................    39
Statements of Operations...............................................    40
Statements of Stockholders' Equity (Deficit)...........................    41
Statements of Cash Flows...............................................    43
Notes to Financial Statements..........................................    44
</TABLE>




                                       37
<PAGE>   38

                        REPORT OF INDEPENDENT ACCOUNTANTS


To the Board of Directors
and Stockholders of Autoweb.com, Inc.

    In our opinion, the accompanying balance sheets and the related statements
of operations, of stockholders' equity (deficit) and of cash flows present
fairly, in all material respects, the financial position of Autoweb.com, Inc. at
December 31, 2000 and 1999 and the results of its operations and its cash flows
for each of the three years in the period ended December 31, 2000 in conformity
with accounting principles generally accepted in the United States of America.
These financial statements are the responsibility of Autoweb.com, Inc.'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 audits 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, as well
as evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.



PRICEWATERHOUSECOOPERS LLP

San Jose, California
January 22, 2001, except for
  Note 6 as to which the date is April 2, 2001.




                                       38
<PAGE>   39

                                AUTOWEB.COM, INC

                                 BALANCE SHEETS
               (IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)


<TABLE>
<CAPTION>
                                                                                       DECEMBER 31,
                                                                                       ------------
                                                                                   2000           1999
                                                                                ---------      ---------
<S>                                                                             <C>            <C>
                                     ASSETS

Current assets:
    Cash and cash equivalents ................................................  $  27,137      $   9,387
    Restricted cash ..........................................................         --          2,550
    Short-term investments ...................................................         --         20,897
    Accounts receivable, net of allowance for doubtful accounts of $926 and
      $1,176 in 2000 and 1999, respectively ..................................      8,518          8,415
    Prepaid expenses and other current assets ................................     10,149          8,988
                                                                                ---------      ---------
            Total current assets .............................................     45,804         50,237
Property and equipment, net ..................................................      2,285          2,462
Purchased technology and other intangible assets, net ........................     11,878         18,448
Deposits and other assets ....................................................        177            530
                                                                                ---------      ---------
            Total assets .....................................................  $  60,144      $  71,677
                                                                                =========      =========

                      LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
    Accounts payable and other accrued expenses ..............................  $   3,705      $   6,787
    Accrued payroll and related expenses .....................................        991          2,582
    Deferred revenue .........................................................        773            935
    Current portion of notes payable .........................................        314            326
                                                                                ---------      ---------
            Total current liabilities ........................................      5,783         10,630
Notes payable, net of current portion ........................................         --            361
                                                                                ---------      ---------
            Total liabilities ................................................      5,783         10,991

Commitments (Note 6)

Stockholders' equity:
    Preferred stock, $0.001 par value:
        Authorized: 5,000,000 shares
        Issued and outstanding: none in 2000 and 1999 ........................         --             --
    Common stock, $0.001 par value:
        Authorized: 60,000,000 shares
        Issued and outstanding: 29,539,682 shares in 2000 and
          25,584,025 shares in 1999 ..........................................         26             22
    Additional paid-in capital ...............................................    131,761        104,233
    Notes receivable from stockholder ........................................       (786)          (786)
    Unearned stock-based compensation ........................................     (2,489)        (7,002)
    Accumulated deficit ......................................................    (74,151)       (35,781)
                                                                                ---------      ---------
            Total stockholders' equity .......................................     54,361         60,686
                                                                                ---------      ---------
            Total liabilities and stockholders' equity .......................  $  60,144      $  71,677
                                                                                =========      =========
</TABLE>


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




                                       39
<PAGE>   40

                                AUTOWEB.COM, INC.

                            STATEMENTS OF OPERATIONS
                    (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)


<TABLE>
<CAPTION>
                                                                             YEARS ENDED DECEMBER 31,
                                                                             ------------------------
                                                                         2000          1999          1998
                                                                       --------      --------      --------
<S>                                                                    <C>           <C>           <C>
Net revenues ........................................................  $ 52,280      $ 32,792      $ 13,041
Cost of net revenues ................................................     6,670         3,290           842
                                                                       --------      --------      --------
        Gross profit ................................................    45,610        29,502        12,199
                                                                       --------      --------      --------

Operating expenses:
    Sales and marketing .............................................    53,620        34,668        16,592
    Product development .............................................     8,892         5,674         1,762
    General and administrative ......................................    12,988         7,431         5,270
    Amortization of intangible assets ...............................     6,973         1,943            --
                                                                       --------      --------      --------
        Total operating expenses ....................................    82,473        49,716        23,624
                                                                       --------      --------      --------
Loss from operations ................................................   (36,863)      (20,214)      (11,425)
Interest and other income (expense), net ............................     1,561         2,061           (59)
Loss on investment ..................................................    (3,068)           --            --
                                                                       --------      --------      --------
        Net loss ....................................................   (38,370)      (18,153)      (11,484)
Accretion of mandatorily redeemable convertible preferred stock to
  redemption value ..................................................        --            --          (890)
                                                                       --------      --------      --------
Net loss attributable to common stockholders ........................  $(38,370)     $(18,153)     $(12,374)
                                                                       ========      ========      ========

Net loss per share:
    Basic and diluted ...............................................  $  (1.36)     $  (0.85)     $  (1.58)
    Weighted average shares--basic and diluted ......................    28,291        21,425         7,850
</TABLE>


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




                                       40
<PAGE>   41

                                AUTOWEB.COM, INC.

                  STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
              FOR THE YEARS ENDED DECEMBER 31, 2000, 1999 AND 1998
                                 (IN THOUSANDS)


<TABLE>
<CAPTION>
                                       MANDATORILY
                                       REDEEMABLE
                                       CONVERTIBLE                                   NOTES                                  TOTAL
                                     PREFERRED STOCK   COMMON STOCK   ADDITIONAL  RECEIVABLE    UNEARNED               STOCKHOLDERS'
                                     ---------------  ---------------  PAID-IN       FROM     STOCK-BASED  ACCUMULATED     EQUITY
                                     SHARES   AMOUNT  SHARES   AMOUNT  CAPITAL   STOCKHOLDERS COMPENSATION   DEFICIT     (DEFICIT)
                                     ------  -------  ------   ------ ---------- ------------ ------------ ----------- -------------
<S>                                  <C>     <C>      <C>      <C>    <C>        <C>          <C>          <C>         <C>
Balances, January 1, 1998...........  5,466   $5,261  7,812      $2      $111         $--       $  --        $(4,143)    $ (4,030)
     Accretion of Series A
       mandatorily redeemable
       convertible preferred stock
       to redemption value..........              32                                                             (32)         (32)
     Accretion of Series B
       mandatorily redeemable
       convertible preferred stock
       to redemption value..........             499                                                            (499)        (499)
     Issuance of Series C
       mandatorily redeemable
       convertible preferred stock,
       net of costs of $50..........  2,370    4,965
     Accretion of Series C
       mandatorily redeemable
       convertible preferred stock
       to redemption value..........             317                                                            (317)        (317)
     Issuance of Series D
       mandatorily redeemable
       convertible preferred stock,
       net of costs of $93..........    860    1,942
     Accretion of Series D
       mandatorily redeemable
       convertible preferred stock
       to redemption value..........              42                                                             (42)         (42)
     Repurchase of Series A
       mandatorily redeemable
       convertible preferred
       stock........................   (628)     (89)                                                         (1,111)      (1,111)
     Exercise of stock options......                    205                57                                                  57
     Issuance of common stock in
       exchange for intangible
       assets.......................                     15                13                                                  13
     Issuance of common stock in
       exchange for services........                     15                50                                                  50
     Issuance of common stock in
       exchange for services........                     16                54                                                  54
     Issuance of warrant to
       purchase common stock........                                       79                                                  79
     Unearned stock-based
       compensation.................                                   11,007                   $(11,007)
     Amortization of unearned
       stock-based
       compensation.................                                                               5,601                    5,601
     Net loss.......................                                                                         (11,484)     (11,484)
                                                                                                            --------     --------
Balances, December 31, 1998.........  8,068  $12,969  8,063      $2   $11,371         $--       $ (5,406)   $(17,628)    $(11,661)
                                      -----  -------  -----      --   -------         ---       --------    --------     --------
</TABLE>


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


                                       41
<PAGE>   42
                                AUTOWEB.COM, INC.

            STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)--(CONTINUED)
              FOR THE YEARS ENDED DECEMBER 31, 2000, 1999, AND 1998
                                 (IN THOUSANDS)
<TABLE>
<CAPTION>
                                                         MANDATORILY
                                                          REDEEMABLE
                                                         CONVERTIBLE                                                       NOTES
                                                       PREFERRED STOCK              COMMON STOCK          ADDITIONAL    RECEIVABLE
                                                   -----------------------     -----------------------     PAID-IN         FROM
                                                    SHARES         AMOUNT       SHARES         AMOUNT      CAPITAL     STOCKHOLDERS
                                                   --------       --------     --------       --------    ----------   ------------
<S>                                                <C>            <C>          <C>            <C>         <C>          <C>
Balances, December 31, 1998 .................         8,068       $ 12,969        8,063       $      2     $ 11,371      $    --
     Issuance of common stock for cash
       pursuant to the Initial Public
       Offering, net of offering expenses?
       of $1,142 ............................                                     5,550              6       71,113
     Issuance of Series D mandatorily
       redeemable convertible preferred
       stock pursuant to exercise of
       stock option .........................           396            938                                                   (686)
     Exercise of common stock option
       for cash and note receivable .........                                       350              1          174          (100)
     Net exercise of common stock
       warrants .............................                                       146
     Issuance of common stock pursuant
       to the conversion of mandatorily
       redeemable convertible preferred
       stock ................................        (8,464)       (13,907)      10,891             11       13,896
     Issuance of common stock in
       conjunction with the purchase of
       the assets of The Automotive
       Information Center ...................                                       363              1        3,327
     Exercise of stock options ..............                                       221              1          513
     Unearned stock-based?
       compensation .........................                                                                 3,839
     Amortization of unearned stock-
       based compensation ...................
     Net loss ...............................
                                                   --------       --------     --------       --------     --------      --------
Balances, December 31, 1999 .................            --             --       25,584             22      104,233          (786)
     Issuance of common stock for
       cash .................................                                     3,785              4       29,781
     Issuance of common stock pursuant
       to the employee stock purchase
       plan .................................                                       157                         547
     Exercise of stock options ..............                                        43                          83
     Repurchase of unvested stock
       options ..............................                                       (29)                        (11)
     Unearned stock-based
       compensation, cancellations ..........                                                                (2,872)
     Amortization of unearned stock-
       based compensation, net ..............
     Net loss ...............................
                                                   --------       --------     --------       --------     --------      --------
Balances, December 31, 2000 .................            --       $     --       29,540       $     26     $131,761      $   (786)
                                                   ========       ========     ========       ========     ========      ========
</TABLE>

<TABLE>
<CAPTION>
                                                                                    TOTAL
                                                    UNEARNED                     STOCKHOLDERS'
                                                   STOCK-BASED     ACCUMULATE       EQUITY
                                                  COMPENSATION      DEFICIT       (DEFICIT)
                                                  ------------    ----------    -------------
<S>                                               <C>             <C>           <C>
Balances, December 31, 1998 .................       $ (5,406)      $(17,628)      $(11,661)
     Issuance of common stock for cash
       pursuant to the Initial Public
       Offering, net of offering expenses?
       of $1,142 ............................                                       71,119
     Issuance of Series D mandatorily
       redeemable convertible preferred
       stock pursuant to exercise of
       stock option .........................                                         (686)
     Exercise of common stock option
       for cash and note receivable .........                                           75
     Net exercise of common stock
       warrants .............................
     Issuance of common stock pursuant
       to the conversion of mandatorily
       redeemable convertible preferred
       stock ................................                                       13,907
     Issuance of common stock in
       conjunction with the purchase of
       the assets of The Automotive
       Information Center ...................                                        3,328
     Exercise of stock options ..............                                          514
     Unearned stock-based?
       compensation .........................         (3,839)
     Amortization of unearned stock-
       based compensation ...................          2,243                         2,243
     Net loss ...............................                       (18,153)       (18,153)
                                                    --------       --------       --------
Balances, December 31, 1999 .................         (7,002)       (35,781)        60,686
     Issuance of common stock for
       cash .................................                                       29,785
     Issuance of common stock pursuant
       to the employee stock purchase
       plan .................................                                          547
     Exercise of stock options ..............                                           83
     Repurchase of unvested stock
       options ..............................                                          (11)
     Unearned stock-based
       compensation, cancellations ..........          2,872
     Amortization of unearned stock-
       based compensation, net ..............          1,641                         1,641
     Net loss ...............................                       (38,370)       (38,370)
                                                    --------       --------       --------
Balances, December 31, 2000 .................       $ (2,489)      $(74,151)      $ 54,361
                                                    ========       ========       ========
</TABLE>

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


                                       42
<PAGE>   43

                                AUTOWEB.COM, INC.

                            STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                                    YEARS ENDED DECEMBER 31,
                                                                            --------------------------------------
                                                                              2000           1999           1998
                                                                            --------       --------       --------
<S>                                                                         <C>            <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net loss ...........................................................      $(38,370)      $(18,153)      $(11,484)
  Adjustments to reconcile net loss to net cash used in operating
    activities:
      Issuance of common stock in exchange for services ..............            --             --            133
      Depreciation and amortization of tangible assets ...............         1,892          1,139            551
      Amortization of intangible assets ..............................         6,975          1,943             --
      Write down of intangible assets ................................            --             --             13
      Provision for doubtful accounts ................................          (255)           678            433
      Amortization of stock-based compensation .......................         1,641          2,243          5,601
      Revenue settled by an investment in equity securities ..........         3,068             --             --
      Impairment of investment .......................................        (3,068)            --             --
      Change in assets and liabilities:
        Restricted cash ..............................................         2,550         (2,550)            --
        Accounts receivable ..........................................          (156)        (5,617)        (2,130)
        Prepaid expenses and other current assets ....................          (859)        (7,797)          (612)
        Deposits and other assets ....................................           354           (530)            --
        Accounts payable and other accrued expenses ..................        (3,081)         4,294          1,741
        Accrued payroll and related expenses .........................        (1,591)         1,570            460
        Deferred revenue
                                                                                (162)        (1,428)           740
                                                                            --------       --------       --------
          Net cash used in operating activities
                                                                             (31,062)       (24,208)        (4,554)
                                                                            --------       --------       --------

CASH FLOWS FROM INVESTING ACTIVITIES:
  Purchase of short-term investments .................................            --        (20,897)            --
  Maturity of short-term investments .................................        20,897
  Acquisition of property and equipment ..............................        (1,717)        (2,205)        (1,238)
  Acquisition of purchased technology ................................          (398)        (1,707)            --
  Cash paid for The Automotive Information Center
                                                                                  --        (16,000)            --
                                                                            --------       --------       --------
          Net cash provided by (used in) investing activities
                                                                              18,782        (40,809)        (1,238)
                                                                            --------       --------       --------

CASH FLOWS FROM FINANCING ACTIVITIES:
  Principal payments under capital lease obligations and notes payable          (373)          (270)           (61)
  Proceeds from borrowings under long-term debt facility .............            --             --            934
  Proceeds from issuance of mandatorily redeemable convertible
    preferred stock ..................................................            --            252          6,957
  Proceeds from issuance of common stock, net of issuance costs ......        30,403         71,708             57
  Repurchase of mandatorily redeemable convertible preferred stock ...            --             --         (1,200)
          Net cash provided by financing activities ..................        30,030         71,690          6,687

Net increase in cash and cash equivalents ............................        17,750          6,673            895
Cash and cash equivalents, at beginning of year
                                                                               9,387          2,714          1,819
                                                                            --------       --------       --------
Cash and cash equivalents, at end of year ............................      $ 27,137       $  9,387       $  2,714
                                                                            ========       ========       ========
</TABLE>


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


                                       43
<PAGE>   44

                                   AUTOWEB.COM

                          NOTES TO FINANCIAL STATEMENTS

1--THE COMPANY

        Autoweb.com, Inc. (the "Company") was incorporated in California on
October 3, 1995 as Downtown Web, Inc. and reincorporated in Delaware on March
16, 1999. The Company provides a consumer automotive Internet service, whereby
its Web site enables consumers to select new or pre-owned vehicles from member
dealers, and the Company also offers services that enable consumers to purchase
automotive-related products and services such as insurance and financing. The
Company also provides, through its division AIC, automotive and on-line research
tools for automotive manufacturers, major web portals and other industries. The
Company markets and sells it's services primarily in North America and operates
in one business segment.

        The Company sold 5,550,000 shares of common stock at $14.00 per share
upon completing its initial public offering on March 26, 1999 and raised $71.1
million, net of underwriting discounts and commissions and offering expenses.

        The Company has sustained net losses and negative cash flows from
operations since its inception. The Company's ability to meet its obligations in
the ordinary course of business is dependent on its ability to achieve
profitable operations and/or raise additional financing through public or
private equity financings or other sources of financing to fund operations.
However, there is no assurance that the Company will achieve profitable
operations or that it will be able to raise adequate financing from other
sources. Management believes that its current funds will be sufficient to enable
the Company to meet its planned expenditures through at least December 31, 2001.
If anticipated operating results are not achieved, management has the intent and
it believes that it has the ability to delay or reduce expenditures so as not to
require additional financial resources, if such resources were not available on
terms acceptable to the Company.


2--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

    Use of Estimates

        The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and the
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.


    Concentrations of Credit Risk

        Financial instruments that potentially subject the Company to a
concentration of credit risk consist of cash and cash equivalents, restricted
cash, short-term investments and accounts receivable. Cash, cash equivalents,
restricted cash, and short-term investments are deposited with seven high
quality financial institutions in the United States. The Company maintains
allowances for potential credit losses and such losses have been within
management's expectations. The Company's accounts receivable are derived from
revenues earned primarily from customers located in the United States and the
Company performs ongoing credit evaluations of its customers' financial
condition. The Company generally requires no collateral from its customers and
maintains an allowance for doubtful accounts receivable based on the expected
collectability. There was no customer which represented 10% or more of the net
revenues for the years ended December 31, 2000, 1999 and 1998 or which
represented 10% or more of accounts receivable at December 31, 2000 and 1999.


    Fair Value of Financial Instruments

        Carrying amounts of certain of the Company's financial instruments,
including cash and cash equivalents, restricted cash, short-term investments,
accounts receivable, accounts payable and other accrued liabilities, approximate
fair value due to their relatively short maturities.


                                       44
<PAGE>   45

                                   AUTOWEB.COM

                   NOTES TO FINANCIAL STATEMENTS--(CONTINUED)


    Cash and Cash Equivalents

        The Company considers all highly liquid investments purchased with
original maturities or remaining maturities at the time of purchase of three
months or less to be cash equivalents. Cash equivalents consist primarily of
deposits in money market funds.


    Investments

        The Company considers all investments purchased with an original
maturity or remaining maturities at the balance sheet date of less than twelve
months to be short-term investments. At December 31, 2000, the Company had no
short-term or long-term investments. The Company classifies, at the time of
acquisition, its investments into categories in accordance with the provisions
of Statement of Financial Accounting Standards ("SFAS") No. 115, "Accounting for
Certain Investments in Debt and Equity Securities." The Company classifies its
investments as available-for-sale, which are reported at fair market value.
Unrealized gains and losses at December 31, 1999 were not material. Realized
gains and losses, declines in value of securities judged to be other than
temporary, and interest and dividends on all securities are included in interest
and other income.


    Property and Equipment

        Property and equipment are stated at cost and are depreciated on a
straight line basis over the estimated useful lives of the assets, generally two
years. Maintenance and repairs are charged to expense when incurred. When assets
are sold or retired, the cost and related accumulated depreciation are removed
from the accounts and any resulting gain or loss is included in operations.


    Impairment of Long-Lived Assets

        The Company evaluates the recoverability of long-lived assets in
accordance with statement of Financial Accounting Standards No. 121, "Accounting
for the Impairment of Long-Lived Assets to be Disposed of" ("SFAS No. 121").
SFAS 121 requires recognition of impairment of long-lived assets in the event of
the net book value of such assets exceeds the future undiscounted cash flows
attributable to such assets.

        During 2000, the Company recorded an impairment charge of $3.1 million
related to declines in the value of equity securities in a private company which
was deemed to be other than temporary.


    Intangible Assets

        Intangible assets include acquired technology, trade names, assembled
workforce and customer base. Goodwill resulting from acquisitions is recorded
based upon the excess of the purchase price and the net tangible and intangible
assets acquired. The fair value of intangible assets has been determined by an
independent appraiser. Intangible assets are amortized on a straight-line basis
over periods ranging from three to four years.


    Revenue Recognition

        Revenues are derived primarily from fees charged to member dealers for
each qualified purchase inquiry provided to them by the Company. The revenue
related to the fee is recognized at the time the qualified purchase inquiry is
forwarded to the member dealer provided that no significant obligations for the
Company remain and collection of the resulting receivable is probable. The
Company establishes a revenue reserve for customer allowances based on the
Company's historical experience. The Company initially charged member dealers on
a "subscription" model basis, whereby each member dealer paid an initial set-up
fee and/or a flat monthly fee in exchange for receiving qualified purchase
inquiries from the Company. Under the former subscription model, revenue from
both the initial and/or monthly fee was initially deferred and then recognized
ratably over the term of the agreement, generally one year. Revenue from the
former subscription model largely ceased in 1999.




                                       45
<PAGE>   46

                                   AUTOWEB.COM

                   NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

        The Company also derives revenues from the data, tools and services it
provides to automotive manufacturers, major Web portals and other industries.
Revenue is recognized ratably over the period the tools and services are made
available to the customer.

        The Company also derives revenues from the sale of banner
advertisements, which is recognized ratably in the period in which the
advertisement is displayed, provided that no significant obligations for the
Company remain and collection of the resulting receivable is probable. To the
extent that minimum guarantee page deliveries are not met, the Company defers
recognition of the corresponding revenues until the guaranteed page deliveries
are achieved. Barter advertisement transactions are recorded at their estimated
fair value based on the Company's historical experience of selling similar
advertising for cash. Barter revenue represented 0.3%, 2.4% and 5.6% of net
revenues for the year ended December 31, 2000, 1999 and 1998, respectively.

        In December 1999, the Securities and Exchange Commission (SEC) issued
Staff Accounting Bulletin No. 101 or SAB 101, Revenue Recognition in Financial
Statements, which provides guidance on the recognition, presentation, and
disclosure of revenue in financial statements filed with the Commission. SAB 101
outlines the basic criteria that must be met to recognize revenue and provides
guidance for disclosures related to revenue recognition policies. On March 24,
2000 and June 26, 2000, the SEC issued Staff Accounting Bulletin No. 101A and
No. 101B, respectively, which extended the transition provisions of SAB 101
until no later than the fourth quarter of fiscal years beginning after December
15, 1999. The Company has reviewed its revenue recognition policies and
determined that it is in compliance with SAB 101.


    Product Development Costs

        Product development costs are expensed as incurred. Costs incurred in
the design, creation and maintenance of content, graphics and user interface of
the Company's Web site are expensed as incurred in accordance with SOP 98-1
"Accounting for the Costs of Computer Software Development or Obtained for
Internal Use." Costs incurred in the development of application and
infrastructure of the Web sites are capitalized and amortized over the useful
life of the web sites. In 2000 and 1999, the costs that could be capitalized
were insignificant.


    Advertising

        Advertising costs are expensed as incurred and totaled $36.1 million,
$20.6 million and $5.8 million during the years ended December 31, 2000, 1999
and 1998, respectively and have been included in sales and marketing expense in
the statements of operations.


    Stock-Based Compensation

        In 1997, the company adopted the disclosure provisions of SFAS No. 123,
"Accounting for Stock-Based Compensation." The Company has elected to continue
accounting for stock-based compensation issued to employees using Accounting
Principles Board ("APB") Opinion No. 25, "Accounting for Stock Issued to
Employees" Under APB No. 25, and related interpretations, including Financial
Interpretation No. 44, compensation expense is based on the difference, if any,
on the date of the grant between the fair value of the Company's stock and the
exercise price. Stock issued to non-employees has been accounted for in
accordance with SFAS No. 123 and valued using the Black-Scholes model.


    Income Taxes

        The Company accounts for income taxes in accordance with SFAS No. 109,
"Accounting for Income Taxes." This statement prescribes the use of the
liability method whereby deferred tax assets and liability account balances are
calculated at the balance sheet date using current tax laws and rates in effect.
Valuation allowances are established when necessary to reduce deferred tax
assets where it is more likely than not that the deferred tax asset will not be
realized. Net Loss Per Share



                                       46
<PAGE>   47

                                   AUTOWEB.COM

                   NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

    The Company computes net loss per share in accordance with SFAS No. 128,
"Earnings per Share" and SEC Staff Accounting Bulletin ("SAB") 98. Under the
provision of SFAS No. 128, basic net loss per share is computed by dividing the
net loss attributable to common stockholders for the period by weighted average
number of common shares outstanding during the period. Diluted net loss per
share is computed by dividing the net loss for the period by the weighted
average number of common and common equivalent shares outstanding during the
period. Common equivalent shares, composed of common shares issuable upon the
exercise of stock options and warrants and upon conversion of Series A, Series
B, Series C and Series D mandatorily redeemable convertible preferred stock, are
included in the diluted net loss per share computation to the extent such shares
are dilutive.

<TABLE>
<CAPTION>
                                                                                  YEARS ENDED DECEMBER 31,
                                                                          --------------------------------------
                                                                            2000           1999           1998
                                                                          --------       --------       --------
                                                                          (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<S>                                                                       <C>            <C>            <C>
Numerator:
    Net loss .......................................................      $(38,370)      $(18,153)      $(11,484)
    Accretion of mandatorily redeemable convertible preferred
      stock to redemption value:
        Series A ...................................................            --             --            (32)
        Series B ...................................................            --             --           (499)
        Series C ...................................................            --             --           (317)
        Series D
                                                                                --             --            (42)
                                                                          --------       --------       --------
    Net loss attributable to common stockholders ...................      $(38,370)      $(18,153)      $(12,374)
                                                                          ========       ========       ========

Denominator:
    Weighted average shares--basic and diluted .....................        28,291         21,425          7,850

    Net loss per share--basic and diluted ..........................      $  (1.36)      $  (0.85)      $  (1.58)
                                                                          --------       --------       --------
Antidilutive securities, including options, warrants and mandatorily
  redeemable preferred stock .......................................         2,300          5,610          1,400
                                                                          ========       ========       ========
</TABLE>


    Business Segments

        In June 1997, the FASB issued SFAS No. 131, "Disclosure about Segments
of an Enterprise and Related Information." SFAS No. 131 requires publicly held
companies to report financial and other information about key revenue segments
of the entity for which such information is available and is utilized by the
chief operation decision maker. SFAS No. 131 is effective for the fiscal years
commencing December 15, 1997. The Company conducts its business within one
business segment within North America. Revenues from customers outside of the
United States were less than 10% of net revenues for all periods represented in
the accompanying statements of operations.


    Comprehensive Income

        Effective January 1, 1998, the Company adopted the provisions of SFAS
No. 130, "Reporting Comprehensive Income." SFAS No. 130 requires companies to
classify items of other comprehensive income and its components in financial
statements and display the accumulated balance of other comprehensive income
separately from retained earnings in the equity section of a statement of
financial position. The Company's total comprehensive loss was the same as its
net loss for the years ended December 31, 2000, 1999, and 1998.


                                       47
<PAGE>   48

                                   AUTOWEB.COM

                   NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

    Recent Accounting Pronouncements

        In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities." SFAS No. 133 is effective for all fiscal
quarters of all years beginning after June 15, 1999. SFAS No. 133 requires that
all derivative instruments be recorded on the balance sheet at fair market
value. Changes in the fair value of derivatives are recorded each period in the
current earnings or other comprehensive income, depending on whether a
derivative is designed as part of a hedge transaction and, if it is, the type of
hedge transaction. In June 1999, the FASB issued SFAS No. 137, which delayed the
effective date of SFAS No. 133 to fiscal years beginning after June 15, 2000.
The adoption of SFAS No. 133 did not have a material impact on our financial
statements.


3--RESTRICTED CASH

        At December 31, 1999, the Company had $2.6 million on deposit with a
bank that was held as collateral for a letter of credit with a vendor. There was
no restricted cash at December 31, 2000.


4--BALANCE SHEET COMPONENTS:

<TABLE>
<CAPTION>
                                                             DECEMBER 31,
                                                       -----------------------
                                                         2000           1999
                                                       --------       --------
                                                            (IN THOUSANDS)
<S>                                                    <C>           <C>
Short-Term Investments:
    Government obligations ......................      $     --       $  1,989
    Commercial Paper ............................            --         18,908
                                                       --------       --------
                                                       $     --       $ 20,897
                                                       ========       ========

Prepaid Expenses and Other Current Assets:
    Prepaid on-line advertising .................      $  9,506       $  5,683
    Prepaid expenses and other current assets ...           643          3,305
                                                       --------       --------
                                                       $ 10,149       $  8,988
                                                       ========       ========

Property and Equipment:
    Computer equipment and software .............      $  3,920       $  2,584
    Office equipment ............................           619            452
    Furniture and fixtures ......................         1,527          1,315
                                                       --------       --------
                                                          6,066          4,351
Less accumulated depreciation and amortization ..
                                                         (3,781)        (1,889)
                                                       --------       --------
                                                       $  2,285       $  2,462
                                                       ========       ========

Purchased Technology and Other Intangible Assets:
    Acquired technology/database ................      $  2,809       $  2,809
    Trade name ..................................           480            480
    Assembled workforce .........................         1,728          1,728
    Customer base ...............................         5,727          5,727
    Goodwill ....................................        10,039          9,647
                                                       --------       --------
                                                         20,783         20,391
Less accumulated amortization ...................        (8,905)        (1,943)
                                                       --------       --------
                                                       $ 11,878       $ 18,448
                                                       ========       ========
</TABLE>

5--NOTES PAYABLE

        The Company had $314,000 outstanding under notes payable at December 31,
2000. The notes bear interest at an annual rate of 18.4%, mature in 2001, and
are collateralized by specific equipment.


                                       48
<PAGE>   49

                                   AUTOWEB.COM

                   NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

        Future minimum principal payments are as follows (in thousands):

<TABLE>
<CAPTION>
YEAR ENDING DECEMBER 31,:
-------------------------
<S>                                                                        <C>
        2001 ............................................................  $ 314
</TABLE>


6--COMMITMENTS INCLUDING THOSE WITH RELATED PARTY AND SUBSEQUENT EVENTS.

    Operating Leases

        The Company leases its offices under non-cancelable operating leases
which expire through May, 2005.

        The future minimum lease payments under non-cancelable operating leases
are (in thousands).

<TABLE>
<CAPTION>
    YEAR ENDING DECEMBER 31,:
    -------------------------
<S>                                                                                       <C>
            2001.........................................................................  $ 918
            2002.........................................................................    922
            2003.........................................................................    942
            2004.........................................................................    694
            2005.........................................................................    120
                                                                                          ------
                                                                                          $3,596
                                                                                          ======
</TABLE>

        Facility rent expenses for the years ended December 31, 2000, 1999, and
1998, was $1,283,000, $843,000 and $597,000, respectively.


    Marketing Agreements

        During 2000, the Company had agreements with three global Internet media
companies to maintain certain exclusive promotional rights and linkage with the
media companies and to receive certain advertising. In addition, the Company
shares in certain advertising revenues earned by the media companies. At
December 31, 2000, one of these agreements was no longer in effect. Another of
those agreements had been entered into on March 26, 2000 and on April 18, 2000
the related party had finalized its purchase of newly-issued unregistered shares
of common stock from the Company for approximately $21.9 million, resulting in
the ownership of approximately 10% of the Company's outstanding common stock.
The related party has registration rights with respect to those shares. The
March 2000 agreement committed the Company to the following payments for
services to be provided by the shareholder: year ending 2000 - $9.7 million, of
which $7.2 million was expensed in 2000 and included in advertising expense;
2001 - $10.0 million; 2002 - $10.0 million; 2003 - $2.5 million. In addition,
the Company participated in certain advertising revenue earned by the related
party shareholder which, in 2000, totaled approximately $1.0 million. On March
21, 2001 the agreement was terminated and the Company made a final payment of
$13.3 million to the shareholder in settlement of its then outstanding
commitments; no specific services were received for that payment. Such amount
will be charged to results in the first quarter of 2001. The Company will
continue to receive certain content and customer referrals from the related
party shareholder and will participate in certain advertising revenue earned by
the related party shareholder. Also, on April 2, 2001, the Company entered into
an amendment of the agreement with the remaining global Internet media company
which provides for a reduction in the advertising received in consideration for
reduced payments.

        The future remaining payments under the agreement were reduced from $6.7
million, $8.8 million and $6.7 million as compared to the payments under the
amended arrangement of $3.8 million, $5.1 million and $3.8 million, for the
remainder of 2001, 2002 and 2003, respectively.


        The Company also has multi-year agreements with other Internet
advertisers and automotive information providers that make available to
consumers vehicle research data over the Internet. Such agreements require that
the Company pay fees to these companies based on the volume of referrals
received by the Company from these services. The Company expenses these amounts
as the services are provided.

    Litigation



                                       49
<PAGE>   50

                                   AUTOWEB.COM

                   NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

        From time to time, the Company may be involved in litigation arising out
of claims in the normal course of business. Based upon the information presently
available, including discussion with outside legal counsel, management believes
that there are no claims or actions pending or threatened against the Company,
the ultimate resolution of which will have a material adverse effect on the
Company's financial position, liquidity or results of operations.


7--MANDATORILY REDEEMABLE CONVERTIBLE PREFERRED STOCK

        All mandatorily redeemable convertible preferred stock was converted
into common stock in March 1999 immediately prior to the Company's initial
public offering.

        In December 1998, the company granted an option to the Chairman to
purchase up to 395,661 shares of the Company's Series D mandatorily redeemable
convertible preferred stock at $2.37 per share. The fair value of the option
grant was estimated to be $1.7 million using the intrinsic value method, and was
included in the stock-based compensation charge in the year ended December 31,
1998. In January 1999, the option was exercised for 395,661 shares of Series D
mandatorily redeemable convertible preferred stock in exchange for $252,000 in
cash together with an interest-free full recourse promissory note in the amount
of $686,000 from the Chairman collateralized by the stock. The note is due and
payable on the third anniversary of date of issuance of the stock. These shares
of Series D mandatorily redeemable convertible preferred stock subsequently
converted into 395,661 shares of common stock immediately prior to the Company's
initial public offering in March 1999.


8--COMMON STOCK

        The Company's Certificate of Incorporation, as amended, authorizes the
Company to issue 60,000,000 shares of common stock. Each share of common stock
has the right to one vote. The holders of common stock are also entitled to
receive dividends whenever funds are legally available and when declared by the
Board of Directors, subject to the prior rights of all classes of stock at the
time outstanding having priority rights as to dividends.


9--EMPLOYEE BENEFIT PLANS

    401(k) Savings Plan

        The Company has a savings plan (the "Savings Plan") that qualifies as a
deferred salary arrangement under Section 401(k) of the Internal Revenue Code.
Under the Savings Plan, participating employees may defer a percentage (not to
exceed 25%) of their eligible pretax earnings up to the Internal Revenue
Service's annual contribution limit. All employees of the Company are eligible
to participate in the Savings Plan. The Company is not required to contribute to
the Savings Plan and has made no contribution since the inception of the Savings
Plan.


    Employee Stock Purchase Plan

        In 1999, the Company's Board of Directors adopted and the stockholders
approved the 1999 Employee Stock Purchase Plan (the "Purchase Plan") and
reserved a total of 400,000 shares of common stock for issuance thereunder in
addition to an automatic increase on January 1st of each year by an amount equal
to 1% of the shares of common stock outstanding on the immediately preceding
December 31. On January 1, 2000 and January 1, 2001, the automatic increases in
the shares reserved were 255,840 and 295,268, respectively. In 2000, the
Company's Board of Directors approved an additional 255,840 shares of common
stock to be reserved and available under the Employee Stock Purchase Plan. Under
the Purchase Plan, eligible employees will be permitted to acquire shares of the
Company's common stock through payroll deductions (not to exceed 15%). The
purchase price for the Company's common stock purchased under the Purchase Plan
is 85% of the lesser of the fair market value of the Company's common stock on
the first day or the last day of the purchase period. All employees of the
Company are eligible to participate in the Purchase Plan.

    1997 Stock Option Plan



                                       50
<PAGE>   51

                                   AUTOWEB.COM

                   NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

        In April 1997, the Company's Board of Directors adopted the 1997 Stock
Option Plan ("1997 Plan"). The 1997 Plan provides for the granting of stock
options to employees and consultants of the Company (including officers and
directors who are also employees.)

        Options under the 1997 Plan may be granted for periods of up to ten
years and at prices no less than 85% of the estimated fair value of the shares
on the date of the grant as determined by the Board of Directors, provided,
however, that ( i ) the exercise price of an Incentive Stock Option ("ISO") may
not be less than 100% of the estimated fair value of the shares on the date of
the grant, and ( ii ) the exercise prices of an ISO granted to a 10% stockholder
may not be less than 110% of the estimated fair value of the shares on the date
of grant. Options are exercisable immediately, subject to repurchase rights held
by the Company that generally lapse over a period of four years.


    1999 Equity Incentive Plan

        In 1999, the Company's Board of Directors adopted and the stockholders
approved the 1999 Equity Incentive Plan (the "Equity Plan") and reserved a total
of 2,800,000 shares of common stock for issuance thereunder. These shares are in
addition to shares under the 1997 Plan not issued. The Equity Plan provides for
the grant of both "ISOs" and nonqualified stock options ("NQSOs"). ISOs may be
granted only to employees of the Company and NQSOs may be granted to employees
and consultants of the Company (including officers and directors).

    Options under the Equity Plan may be granted for periods of up to ten years
and at prices no less than 85% of the estimated fair value of the shares on the
date of the grant as determined by the Board of Directors, provided, however,
that (i) the exercise price of an ISO may not be less than 100% of the estimated
fair value of the shares on the date of the grant, and (ii) the exercise price
of an ISO granted to a 10% stockholder may not be less than 110% of the
estimated fair value of the shares on the date of grant. The exercise price of
NQSOs must be at least equal to 85% of the fair market value of the Company's
common stock on the date of grant. Options may be exercisable only as they vest
and the vesting period is generally four years.

        The following summarizes activity under the 1997 Stock Option Plan and
the 1999 Equity Incentive Plan (together "the Plans") for the years ended
December 31, 2000, 1999 and 1998 (in thousands except per share amounts):

<TABLE>
<CAPTION>
                                                                     OPTIONS OUTSTANDING
                                                                     -------------------
                                             SHARES                       WEIGHTED
                                            AVAILABLE       NUMBER        AVERAGE       AGGREGATE
                                               FOR            OF          EXERCISE       EXERCISE
                                              GRANT         SHARES         PRICE          PRICE
                                            ---------      --------       --------      ---------
<S>                                         <C>            <C>            <C>           <C>
Outstanding, January 1, 1998 .........           290            363       $ 0.1770       $     64
      Additional shares reserved .....         2,300
      Granted ........................        (1,934)         1,934       $ 0.5000            967
      Exercised ......................                         (205)      $ 0.2767            (57)
      Cancelled ......................           261           (261)      $ 0.3202            (83)
                                            --------       --------                      --------
Outstanding, December 31, 1998 .......           917          1,831       $ 0.4866            891
      Additional shares reserved .....         2,950
      Granted ........................        (3,121)         3,121       $ 8.4143         26,261
      Exercised ......................                         (571)      $ 1.2067           (689)
      Cancelled ......................           612           (612)      $ 6.6225         (4,053)
                                            --------       --------                      --------
Outstanding, December 31, 1999 .......         1,358          3,769       $ 5.9459         22,410
      Additional shares reserved .....         2,350
      Granted ........................        (2,819)         2,819       $ 3.3242          9,371
      Exercised ......................                          (43)      $ 1.8903            (83)
      Repurchased ....................            29
      Cancelled ......................         2,839         (2,839)      $ 6.4440        (18,293)
                                            --------       --------                      --------
Outstanding, December 31, 2000 .......         3,757          3,706       $  3.617       $ 13,405
                                            ========       ========                      ========
</TABLE>

        The following table summarizes information concerning outstanding and
exercisable options at December 31, 2000, (in thousands except per share
amounts):

                                       51
<PAGE>   52

                                   AUTOWEB.COM

                   NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

<TABLE>
<CAPTION>
                                                          OPTIONS OUTSTANDING                   OPTIONS EXERCISABLE
                                               ---------------------------------------       -------------------------
                                                                WEIGHTED
                                                                AVERAGE        WEIGHTED                       WEIGHTED
                                                NUMBER OF      REMAINING        AVERAGE       NUMBER OF       AVERAGE
                                                  SHARES      CONTRACTUAL      EXERCISE        SHARES         EXERCISE
      EXERCISE PRICE                           OUTSTANDING    LIFE (YEARS)      PRICE        EXERCISABLE       PRICE
      --------------                           -----------    ------------     --------      -----------      --------
<S>                                            <C>            <C>              <C>           <C>              <C>
      $0.20-$ 0.87...........................     1,266           8.23          $ 0.54            551          $ 0.50
      $1.56-$ 3.25...........................     1,167           9.51          $ 2.48            158          $ 2.42
      $3.33-$ 9.00...........................     1,110           8.83          $ 7.11            394          $ 8.47
      $9.13-$16.25...........................       163           8.87          $11.35             37          $13.56
                                                  -----                                         -----
                                                  3,706                                         1,140
                                                  =====                                         =====
</TABLE>

Fair Value Disclosures

        The Company calculated the fair value of each option grant and each
stock purchase right on the date of grant or issuance using the Black-Scholes
option pricing model with the following assumptions:

<TABLE>
<CAPTION>
                                                                   STOCK OPTIONS                ESPP
                                                                   -------------                ----
                                                                      YEAR ENDED DECEMBER 31,
                                                         ---------------------------------------------
                                                           2000         1999          1998      2000
                                                         --------     --------        ----    --------
<S>                                                      <C>          <C>             <C>     <C>
    Risk-free interest rates...........................  5.3%-6.7%    4.6%-6.2%        5.5%   5.8%-6.6%
    Expected lives.....................................         2            4           5          .6
    Dividend yield.....................................         0            0           0           0
    Volatility.........................................       100%         100%         --         100%
</TABLE>

        For purposes of pro forma disclosures, the estimated fair value of the
options is amortized over the option's vesting period on a straight line basis.
The Company's pro forma information is as follows:

<TABLE>
<CAPTION>
                                                                 YEARS ENDED DECEMBER 31
                                                     --------------------------------------------
                                                        2000             1999             1998
                                                     ----------       ----------       ----------
<S>                                                  <C>              <C>              <C>
Net loss as reported ..........................      $  (38,370)      $  (18,153)      $  (11,484)
Accretion of mandatory redeemable convertible
   preferred stock ............................              --               --             (890)
                                                                      ----------       ----------
Net loss attributable to common stockholders ..      $  (38,370)      $  (18,153)      $  (12,374)
                                                     ==========       ==========       ==========
Net loss--FAS 123 adjusted ....................      $  (38,458)      $  (19,180)      $  (12,521)
                                                     ==========       ==========       ==========
Net loss per share-- as reported (Note 2)
      Basic and diluted .......................      $    (1.36)      $    (0.85)      $    (1.58)
                                                     ==========       ==========       ==========
Net loss per share-- FAS 123 adjusted basic and
   diluted ....................................      $    (1.36)      $    (0.90)      $    (1.60)
                                                     ==========       ==========       ==========
</TABLE>

        In 1999, the Board approved the Employee Stock Purchase Plan ("ESPP")
and reserved 400,000 shares of common stock. Under the plan, employees are
granted the right to purchase shares of common stock at a price per share that
is 85% of the lessor of the fair market value at the beginning of the offering
period or the end of the offering period. In 2000, 156,986 shares were issued at
an average price of $3.47 per share. For pro forma purposes, had compensation
cost for the ESPP been determined based on fair value at the issue date
consistent with the provisions of SFAS 123, the Company's net loss and net loss
per share for 2000 would have been $38.5 million and $1.36 respectively.


    Unearned Stock-Based Compensation

        In connection with certain stock option grants during the years ended
December 31, 1999, and 1998, the Company recorded unearned stock-based
compensation totalling $3.8 million and $11.0 million, respectively, which is
being amortized over the vesting periods of the related options which is
generally four years. In the year ended December 31, 2000 the Company reversed
$2.9 million of unearned stock-based compensation for options which were
cancelled. Amortization of this stock-based compensation recognized during the
years ended December 31, 2000, 1999 and 1998 totalled approximately $1.6
million, $2.2 million and $5.6 million, respectively. The 1998 amortization
reflects accelerated vesting associated with approximately 1.4



                                       52
<PAGE>   53

                                   AUTOWEB.COM

                   NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

million options of common stock granted to the Chairman and the immediate
vesting of the option for 395,661 shares of Series D mandatorily redeemable
convertible preferred stock granted to the Chairman (Note 7).

        Stock-based compensation expense has been reclassified to the relevant
functional expense categories in the years ended December 31, 1999 and 1998 to
conform with the presentation for the year ended December 31, 2000. The
reclassification has no impact on the previously reported operating loss or net
loss.


    10--INCOME TAXES

        The principal items accounting for the difference between income taxes
computed at the U.S. statutory rate and the provision for income taxes are as
follows:

<TABLE>
<CAPTION>
                                                     DECEMBER 31,
                                          ----------------------------------
                                            2000          1999          1998
                                          ------        ------        ------
<S>                                       <C>           <C>           <C>
U.S. statutory rate ................        34.0%         34.0%         34.0%
Operating losses not benefited .....       (34.0)        (34.0)        (34.0)
                                          ------        ------        ------
                                              --%           --%           --%
                                          ======        ======        ======
</TABLE>


        The Company's net deferred tax asset is comprised as follows (in
thousands):

<TABLE>
<CAPTION>
                                                           DECEMBER 31,
                                            --------------------------------------
                                              2000           1999           1998
                                            --------       --------       --------
<S>                                         <C>            <C>            <C>
Net operating loss carryforwards .....      $ 20,131       $  7,404       $  2,608
Other ................................         5,693          2,999            956
                                            --------       --------       --------
                                              25,824         10,403          3,564
Valuation allowance ..................       (25,824)       (10,403)        (3,564)
                                            --------       --------       --------
Net deferred tax asset ...............           $--            $--            $--
                                            ========       ========       ========
</TABLE>

        As of December 31, 2000, the Company had net operating loss
carryforwards available to reduce its future taxable income of approximately
$54.5 million for federal and $27.5 million for state income tax purposes,
respectively. The net operating loss carryforwards expire between 2010 and 2020
for federal and between 2003 and 2005 for state income tax purposes.

        Utilization of net operating losses may be subject to an annual
limitation due to the ownership change limitations provided by the Internal
Revenue Code and similar state provisions. The annual limitation may result in
the expiration of net operating loss carryforwards before utilization.

11--NET REVENUE COMPONENTS

Net revenue can be further analyzed as follows:

<TABLE>
<CAPTION>
                                 YEARS ENDED DECEMBER 31,
                           ---------------------------------
                             2000         1999         1998
                           -------      -------      -------
<S>                        <C>          <C>          <C>
Dealer Sales ...........   $33,891      $21,601      $10,220
Data & Research Tools ..     5,168        1,493           --
Other ..................    13,221        9,698        2,821
                           -------      -------      -------
                           $52,280      $32,792      $13,041
                           =======      =======      =======
</TABLE>


                                       53
<PAGE>   54

                                   AUTOWEB.COM

                   NOTES TO FINANCIAL STATEMENTS--(CONTINUED)

12--SUPPLEMENTAL CASH FLOW DISCLOSURE

<TABLE>
<CAPTION>
                                                                                          YEARS ENDED DECEMBER 31,
                                                                                 -------------------------------------
                                                                                   2000           1999          1998
                                                                                 --------       --------      --------
<S>                                                                              <C>            <C>           <C>
Conversion of preferred stock to common stock ................................        $--       $ 13,907           $--
Unearned stock-based compensation related to stock option grants
   (cancellations) ...........................................................     (2,872)         3,839        11,007
Accretion of mandatorily redeemable convertible preferred stock ..............         --             --           890
Revenue and advertising expense from barter transactions .....................        139            773           733
Acquisition of intangibles in exchange for common stock ......................         --             --            13
Issuance of common stock warrant/common stock in exchange for services .......         --             --            50
Net issuance of common stock warrants ........................................         --            221            --
Issuance of Series D mandatorily redeemable convertible preferred stock
   pursuant to exercise of option for note receivable ........................         --            686            --
Issuance of common stock pursuant to exercise of option for note receivable ..         --            100            --
Liabilities assumed in connection with acquisition of The Automotive
   Information Center:
      Fair value of assets acquired ..........................................                  $ 20,270
      Cash paid ..............................................................                   (16,000)
      Common stock issued ....................................................                    (3,328)
                                                                                                --------
      Liabilities assumed ....................................................                  $    942
                                                                                                ========
Cash paid during the year for interest .......................................   $     87       $    155      $    101
Taxes paid during the year ...................................................         --              1             1
</TABLE>

        During 2000 the Company recognized approximately $3.4 million of revenue
from dealer sales to CarsDirect, a shareholder of the Company, and was
compensated by the issuance of preferred stock, valued at $3.1 million, in the
non-public company and cash of approximately $300,000. Subsequently in 2000 the
Company recorded a charge of $3.1 million to reflect an other than temporary
impairment in the value of those preferred shares.


13--RELATED PARTY TRANSACTIONS

        At December 31, 2000 and 1999, the Company had full recourse promissory
notes receivable in the amount of $960,000 from two stockholders who are also
related parties. Of this amount, $174,000 is included in "prepaid expenses and
other current assets" and $786,000 is included in stockholders' equity as "notes
receivable from stockholders." Notes receivable totaling $922,000 are interest
free and collateralized by 395,661 shares of common stock and the remaining note
receivable for $38,000 bears interest at a rate of 5.59% per annum and is
collateralized by 177,012 shares of common stock. Additional related party
transactions are described in Note 6.

14--SUBSEQUENT EVENTS (UNAUDITED)

        On April 11, 2001, Autoweb entered into a definitive acquisition
agreement with Autobytel. Under the terms of the agreement, Autoweb stockholders
will receive 0.3553 shares of Autobytel common stock in exchange for each share
of Autoweb common stock. Outstanding stock options to purchase shares of Autoweb
common stock will be assumed after adjustment at the same exchange ratio.



                                       54
<PAGE>   55

        2. Financial Statement Schedules


        REPORT OF INDEPENDENT ACCOUNTANTS ON FINANCIAL STATEMENT SCHEDULE

To the Board of Directors of Autoweb.com, Inc.


        Our audits of the financial statements referred to in our report dated
January 22, 2001, except for note 6 as to which the date is April 2, 2001,
appearing in the 2000 Annual Report to Stockholders of Autoweb.com, Inc. as of
December 31, 2000 and 1999, and for each of the three years in the period ended
December 31, 2000, also included an audit of the financial statement schedule
listed in Item 14(a)(2) of this Form 10-K/A. In our opinion, this financial
statement schedule presents fairly, in all material respects, the information
set forth therein when read in conjunction with the related financial
statements.



PRICEWATERHOUSECOOPERS LLP

San Jose, California
April 14, 2001


                                       55
<PAGE>   56




                        VALUATION AND QUALIFYING ACCOUNTS

<TABLE>
<CAPTION>
                                                       BALANCE AT                               BALANCE
                                                       BEGINNING    ADDITIONS                  AT END OF
                                                        OF YEAR   (REDUCTIONS)  WRITE-OFFS       YEAR
                                                       ---------- ------------  ----------     ---------
                                                                           (IN THOUSANDS)
<S>                                                     <C>       <C>           <C>            <C>
Allowance for doubtful accounts:
    Year ended December 31, 1998 .................      $    65      $   429      $     4       $   498
    Year ended December 31, 1999 .................          498        1,028         (350)        1,176
    Year ended December 31, 2000 .................        1,176        1,903       (2,153)          926
Valuation allowance for deferred tax assets:
    Year ended December 31, 1998 .................        1,185        2,379            0         3,564
    Year ended December 31, 1999 .................        3,564        6,839            0        10,403
    Year ended December 31, 2000 .................       10,403        5,120            0        15,523
Customer allowance reserve:
    Year ended December 1998 .....................          225        1,136         (716)          645
    Year ended December 1999 .....................          645        2,876       (2,243)        1,278
    Year ended December 2000 .....................        1,278        5,950       (5,110)        2,118
</TABLE>


        3. Exhibits

        The exhibits listed on the accompanying Exhibit Index are filed or
incorporated by reference as part of this Form 10-K and the Exhibit Index is
incorporated in this filing by reference. Exhibits 10.01, 10.30, 10.32 and 10.38
through and including 10.40 listed on the accompanying Exhibit Index identify
management contracts or compensatory plans or arrangements required to be filed
as exhibits to this report, and this listing is incorporated in this filing by
reference.


        (b) Reports on the Form 8-K:

        None.


                                       56
<PAGE>   57

                                   SIGNATURES

        Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, we have duly caused this Report to be signed on our behalf
by the undersigned, thereunto duly authorized.

                                        AUTOWEB.COM, INC.


                                        By:    /s/  MICHAEL F. SCHMIDT
                                           -------------------------------------
                                                    Michael F. Schmidt
                                                 Chief Financial Officer

    Pursuant to the requirements of the Securities Exchange Act of 1934, this
Report has been signed below by the following persons on our behalf and in the
capacities and on the dates indicated.

<TABLE>
<CAPTION>
                SIGNATURE                                   TITLE                               DATE
                ---------                                   -----                               ----

<S>                                          <C>                                             <C>
/s/ DEAN A. DEBIASE                          Chairman of the Board                           April 30, 2001
-----------------------------------------
             Dean A. DeBiase

/s/ JEFFREY A. SCHWARTZ                       President and Chief Executive Officer           April 30, 2001
-----------------------------------------       (Principal Executive Officer)
           Jeffrey A. Schwartz

/s/ MICHAEL F. SCHMIDT                        Chief Financial Officer (Principal              April 30, 2001
-----------------------------------------       Financial Officer)
           Michael F. Schmidt

/s/ LAWRENCE W. LEPARD                        Director                                        April 30, 2001
-----------------------------------------
           Lawrence W. Lepard

/s/ JAY C. HOAG                               Director
-----------------------------------------
               Jay C. Hoag

/s/ MARK R. ROSS                              Director                                        April 30, 2001
-----------------------------------------
              Mark R. Ross
</TABLE>


                                       57
<PAGE>   58

                                  EXHIBIT INDEX


<TABLE>
<CAPTION>
    NUMBER          EXHIBIT TITLE
    ------          -------------
<S>                 <C>
     2.01           Agreement and Plan of Merger between Autoweb.com, Inc., a
                    California corporation and Registrant.*

     2.02           Asset Purchase Agreement dated as of July 9, 1999, among
                    Autoweb.com, Inc., Sales Enhancer.com, LLC, a Georgia
                    limited liability company ("SE"), Solutions Management,
                    Inc., a Georgia corporation and the sole member of SE
                    ("SMI"), Interactive Monitoring Systems, Inc., a Georgia
                    corporation ("IMS") and Jeffrey Bennett, the sole
                    shareholder of SMI and IMS (incorporated herein by reference
                    to Exhibit 2.01 to Registrant's Periodic Report on Form 8-K
                    filed July 23, 1999).

     2.03           Asset Purchase Agreement dated as of September 8, 1999,
                    among Autoweb.com, Inc., The Gale Group, Inc., a Delaware
                    corporation ("Seller"), Thomson Information Licensing
                    Corporation, a Delaware corporation ("TILC") and THI (U.S.)
                    Inc., a Delaware corporation ("THI") (incorporated herein by
                    reference to Exhibit 2.01 to Registrant's Periodic Report on
                    Form 8-K filed October 21, 1999, as amended December 22,
                    1999).

     3.01           Registrant's Certificate of Incorporation.*

     3.02           Registrant's Bylaws.*

     3.03           Registrant's Certificate of Retirement of preferred stock.*

     3.04           Registrant's Certificate of Designation of preferred stock.*

     4.01           Form of Specimen Certificate for Registrant's common stock.*

     4.02           Amended and Restated Rights Agreement dated October 16, 1998
                    between Registrant and certain stockholders named therein.*

     4.03           Registration Rights Agreement dated as of September 8, 1999
                    by and between Autoweb.com, Inc. and The Gale Group, Inc.
                    (incorporated herein by reference to Exhibit 4.01 to
                    Registrant's Periodic Report on Form 8-K filed October 21,
                    1999, as amended December 22, 1999).

     4.04           Stock Purchase Agreement dated April 7, 2000 between
                    Registrant and Lycos, Inc. (incorporated herein by reference
                    to Exhibit 10.35 to Registrant's Quarterly Report on Form
                    10-Q for the quarter ended March 31, 2000 File No.
                    000-25577).

    10.01           Form of Indemnity Agreement between Registrant and each of
                    its directors and executive officers.*

    10.13           Lease Agreement dated August 27, 1997 by and among Boyd C.
                    Smith, Trustee, Louis B. Sullivan, Trustee and Registrant
                    (related to Registrant's facilities at 3270 Jay Street).*

    10.14           Loan Agreement and Commercial Security Agreement, each dated
                    December 15, 1997, between Registrant and CivicBank of
                    Commerce.*

    10.15           Form of Senior Loan and Security Agreement dated March 20,
                    1998 between Registrant and Phoenix Leasing Incorporated.*

    10.20           Registrant's 1997 Stock Option Plan and related documents.*

    10.21           Registrant's 1999 Equity Incentive Plan and related
                    documents.*

    10.22           Registrant's 1999 Directors Stock Option Plan and related
                    documents.*

    10.23           Registrant's 1999 Employee Stock Purchase Plan.*

    10.24           Promissory notes from Dean DeBiase to Registrant.*

    10.28           Advertising and Promotion Agreement dated June 14, 1999
                    between Registrant and Yahoo! Inc. (incorporated herein by
                    reference to Exhibit 10.28 to Registrant's Quarterly Report
                    on Form 10-Q for the quarter ended June 30, 1999.)**

    10.29           Advertising and Promotion Agreement dated June 30, 1999
                    between Registrant and America Online, Inc. (incorporated
                    herein by reference to Exhibit 10.29 to Registrant's
                    Quarterly Report on Form 10-Q for the quarter ended June 30,
                    1999.)**

    10.30           Offer Letter dated October 8, 1999 by Registrant to Jeffrey
                    A. Schwartz (incorporated herein by reference to Exhibit
                    10.30 to Registrant's Annual Report on Form 10-K for the
                    year ended December 31, 1999 File No. 000-25577).

    10.31           Amendment No. 1 To Lease dated August 6, 1999 by and between
                    A&P Family Investments and Registrant (related to
                    Registrant's facilities at 3270 Jay Street) (incorporated
                    herein by reference to Exhibit 10.31 to Registrant's Annual
                    Report on Form 10-K for the year ended December 31, 1999
                    File No. 000-25577).
</TABLE>


                                       58
<PAGE>   59

<TABLE>
<S>                 <C>
    10.32           Employment Agreement dated November 5, 1999 between
                    Registrant and Sam Hedgpeth(incorporated herein by reference
                    to Exhibit 10.32 to Registrant's Annual Report on Form 10-K
                    for the year ended December 31, 1999 File No. 000-25577).

    10.33           Strategic Co-Marketing dated March 16, 2000 between
                    Registrant and CarsDirect.com, Inc.(incorporated herein by
                    reference to Exhibit 10.33 to Registrant's Quarterly Report
                    on Form 10-Q for the quarter ended March 31, 2000 File No.
                    000-25577)**

    10.34           Agreement dated March 26, 2000 between Registrant and Lycos,
                    Inc. (incorporated herein by reference to Exhibit 10.33 to
                    Registrant's Quarterly Report on Form 10-Q for the quarter
                    ended March 31, 2000 File No. 000-25577)**

    10.35           Stock Purchase Agreement dated April 7, 2000 between
                    Registrant and Lycos, Inc. (incorporated herein by reference
                    to Exhibit 10.35 to Registrant's Quarterly Report on Form
                    10-Q for the quarter ended March 31, 2000 File No.
                    000-25577)

    10.36           Amendment Number 1 to Interactive Marketing Agreement dated
                    April 19, 2000 between Registrant and America Online, Inc.
                    (incorporated herein by reference to Exhibit 10.36 to
                    Registrant's Quarterly Report on Form 10-Q for the quarter
                    ended June 30, 2000 File No. 000-25577)**

    10.37           Amended and Restated Strategic Co-Marketing Agreement dated
                    June 30, 2000 between Registrant and CarsDirect.com, Inc.
                    (incorporated herein by reference to Exhibit 10.37 to
                    Registrant's Quarterly Report on Form 10-Q for the quarter
                    ended June 30, 2000 File No. 000-25577)**

    10.38           Offer Letter dated May 31, 2000 by Registrant to Nadyne G.
                    Edison, Ph.D.(1)

    10.39           Offer Letter dated August 22, 2000 by Registrant to Steve
                    Cottrell.(1)

    10.40           Offer Letter dated December 4, 2000 by Registrant to Michael
                    Schmidt.(1)

    10.41           General Release of Claims dated November 17, 2000 between
                    Registrant and Yahoo! Inc.(1)***

    10.42           Offer Letter dated December 16, 1998 by Registrant to Dean
                    DeBiase, as amended March 30, 2001.

    10.43           Registrant's Change of Control Benefit Plan.

    10.44           Letters dated January 16, 2001 and April 5, 2001 between
                    Registrant and Jeffrey Schwartz regarding participation in
                    Change of Control Benefit Plan.

    10.45           Letters dated January 16, 2001 and April 5, 2001 between
                    Registrant and Regan Senkarik regarding participation in
                    Change of Control Benefit Plan.

    10.46           Letters dated January 16, 2001 and April 5, 2001 between
                    Registrant and Fred Ruffin regarding participation in Change
                    of Control Benefit Plan.

    10.47           Letters dated January 16, 2001 and April 5, 2001 between
                    Registrant and Jerry Karr regarding participation in Change
                    of Control Benefit Plan.

    10.48           Letter dated January 16, 2001 by Registrant to Nadyne
                    Edison regarding participation in Change of Control Benefit
                    Plan.

    23.01           Consent of PricewaterhouseCoopers LLP.
</TABLE>

*       Incorporated herein by reference to the exhibit of like number filed
        with Registrant's Form S-1 Registration Statement, File No. 333-71177,
        on January 26, 1999 or with an amendment thereto.

**      Confidential treatment was granted with regard to certain portions of
        this document. These portions were filed separately with the Securities
        and Exchange Commission.

***     Confidential treatment has been requested with regard to certain
        portions of this document. These portions were filed separately with the
        Securities and Exchange Commission.

(1)     Previously filed with the Registrant's Annual Report on Form 10-K for
        the year ending December 31, 2000.


                                       59