Pelion and UPS Join Efforts to Drive Lean Supply Chains

BOULDER, CO -- (MARKET WIRE) -- October 23, 2006 -- Pelion Systems, a market leader in Manufacturing Operating Systems based on Lean principles, and UPS (NYSE: UPS), the world's largest package delivery company and a global leader in supply chain services, today announced a new relationship designed to help manufacturers drive Lean supply chains.

By combining their respective expertise in manufacturing, technology, engineering and logistics processes, Pelion and UPS aim to create stronger connections between production and distribution and ensure that goods are delivered to the end customers in the most efficient and cost-effective manner possible for all supply chain partners involved.

"At UPS, we focus on taking supply chains to the next level and recognize that the most efficient supply chains are built from the inside out," said Wally Mrozik, president of UPS Professional Services, the UPS business unit managing the relationship. "Pelion's Manufacturing Operating System is a powerful platform for driving efficiency at the factory level, which adds to our ability to help customers pull product through the network at high velocity and effectively meet changing demand."

By defining and executing the processes necessary to achieve true pull-based production, Pelion provides managers with the demand-driven visibility and control needed to deliver superior customer service profitably and make smart business decisions that improve bottom-line performance. Through the coupling of Pelion's technology with UPS's expertise in advanced technology, engineering and project management, customers will be able to maintain tight synchronization of their supply chain and get the most from their Lean initiatives.

"We are very excited to be working with a leader and innovator like UPS. Their focus on driving the distribution network to peak efficiency is well complemented by Pelion's concentration on ensuring that product flowing from the factory is on time and in tune with customer demand," said Kevin Fallon, president and chief executive officer at Pelion Systems. "This represents a major expansion of Pelion's market presence and a continuing focus on enabling the world's best supply chains."

About UPS

UPS is the world's largest package delivery company and a global leader in supply chain services, offering an extensive range of options for synchronizing the movement of goods, information, and funds. Headquartered in Atlanta, UPS serves more than 200 countries and territories worldwide. UPS stock trades on the New York Stock Exchange (UPS) and the company can be found on the Web at UPS.com. To get UPS news direct, visit pressroom.ups.com/RSS.

About Pelion Systems

Pelion Systems is a market leader in Lean Manufacturing Solutions that drive flexibility to help manufacturers solve the customer service vs. profitability challenge. Working with Pelion's expert consultants, Lean Manufacturing Operating System, and individual tools, companies with complex processes and production environments are able to achieve rapid transformations and continuous improvements in areas such as labor, inventory and shipping costs while simultaneously improving cycle time and delivery capabilities. Pelion's technology integrates easily with and extends the value of existing ERP, SCM, and plant-floor systems. Solutions are able to scale from a single facility to an extended enterprise implementation, applying Lean principles to synchronize production, supply, and distribution and form a true demand-driven network. Pelion is headquartered in Boulder, Colorado, with sales offices in Detroit and Chicago. For more information, please visit www.pelionsystems.com.

Contact Information: Press and Analyst Contacts: John Howlett Pelion Systems 720-890-2800 ext. 160 john.howlett@pelionsystems.com Adrienne McGarr Ruder Finn Chicago for Pelion 312-329-3907 mcgarra@ruderfinn.com