HandHeld Entertainment Acquiring FunMansion.com for $1.1 Million

PRLog (Press Release) - Dec 01, 2006 -
SAN FRANCISCO and PORT ST. LUCIE, Fla. – Dec. 1, 2006 – HandHeld Entertainmentä (NASDAQ: ZVUE, ZVUEW) today announced it has acquired FunMansion.com™ for $1.1 million ($350,000 in cash at closing, $150,000 in cash payable over 12 months and a five-year $600,000 note convertible into common stock).

FunMansion.com has averaged approximately 1.5 million unique visitors per month and more than 3.5 million page views per month during the past two months.

“In a little more than two weeks, we have begun assembling a significant collection of user-generated video content by acquiring Dorks.com™ and FunMansion.com,” said Jeff Oscodar, president and chief executive officer of HandHeld Entertainment. “The FunMansion.com acquisition takes us to potentially 2.5 million unique visitors per month, with a combined total of more than 5.4 million page views per month, all tied to the comedy/extreme marketplace. We believe that these funny user-generated and user-submitted videos, photos, jokes and more tend to attract demographics that will be attractive to advertisers and sponsors. We also believe that the combination of ZVUE.com’s commercial content, coupled with our rapidly growing library of user generated content from Dorks.com, FunMansion.com and ZVUE.com’s own FREE Stuff! site, will be a powerful combination for our company.”

HandHeld Entertainment’s user-generated Web properties – Dorks.com, FunMansion.com and FREE Stuff! – now attract nearly 2.5 million unique visitors each month, particularly in the comedy/extreme space. In addition, HandHeld Entertainment announced earlier in November a content agreement with Comedy Time Network to make hundreds of hours of stand-up comedy routines and sketches available for purchase at ZVUE.com. Taken in combination, these two acquisitions and the Comedy Time agreement have helped transform HandHeld Entertainment into a leading provider of comedic/humorous videos for both portable video players and PCs.

Representative of the humorous user-generated and user-submitted videos posted recently on FunMansion.com are the following:
· Nutty Paintball Prank at http://funmansion.com/html/Nutty-Paintball-Prank.html;
· Finger Scratching DJ at http://funmansion.com/html/Finger-Scratching-DJ.html;
· Idiots Playing with Fire at http://funmansion.com/html/Idiots-Playing-With-Fire.html; and
· Female Reporter Loses Her Cool at http://funmansion.com/html/Female-Reporter-Loses-Her-Cool.html.

“FunMansion.com has been around for more than five years, and we’ve seen a strong increase in visitors and page views during the past 18 months,” said Mary Dunne, founder and owner of FunMansion.com. “I’m really excited to be joining the ZVUE.com network of Web sites. Now I can continue to build the site that I love and can do so with greater resources and scale. Those resources should accelerate FunMansion’s growth and bring FunMansion’s user-generated videos to a larger audience.”

HandHeld Entertainment also has more than 4,400 videos available for purchase on ZVUE.com today out of more than 11,000 video selections it has under contract. These selections include music videos, anime features, television shows, movies, cartoons, independent films, documentaries, news, entertainment and sports programs from companies ranging from Sony BMG to IMG Media and from Canadian Broadcast Corp. to Fun Little Movies.

Launched in February 2001, FunMansion.com hosts free user-generated videos, photo slideshows and Flash-based games and movies.