LAS VEGAS, Nov. 26, 2001 (PRIMEZONE) -- PurchasePro (Nasdaq:PPRO) today announced a significant expansion of its relationship with GovernmentFirst, www.egovernmentfirst.com. As part of that expansion, PurchasePro also introduced a flexible new licensing model for its e-Source reverse auction tool.
Earlier this year, GovernmentFirst installed PurchasePro's e-Procurement software and is now implementing the PurchasePro e-Source product to provide a complete range of procurement solutions, including volume discount pricing through aggregated purchasing, contract management, and supplier catalog hosting services to the local government agencies and educational institutions it serves.
Under the innovative licensing agreement, GovernmentFirst will pay a tiered license fee and hosting and maintenance fees based on the dollar volume of transactions. Previously, all PurchasePro e-Source licenses have been priced on a flat-fee basis. GovernmentFirst will pay an initial fee for the right to transact reverse auctions across the PurchasePro Commerce Network on behalf of its customers. It will also pay supplemental license fees as auction volumes reach predetermined thresholds. Specific terms of the transaction were not disclosed.
Chris Benyo, senior vice president of PurchasePro, said, "GovernmentFirst is the first to adopt one of several new pricing models we will be introducing. It is volume based, which we believe is not only attractive in this very challenging economy, but also innovative in the B2B arena. GovernmentFirst is also the first client to purchase both an e-Procurement and e-Source license. In less than 30 days we had their procurement marketplace up and transacting.
"GovernmentFirst is focused and effective in serving their customers. This new pricing model allows GovernmentFirst to expand its already successful e-procurement presence in the business-to-government space with a best-in-class reverse auction tool to drive down costs."
Mr. Benyo added that, "PurchasePro's recent agreement with Avantrust, a joint venture between AIG and D&B, to provide suppliers on the PurchasePro Commerce Network with the Avantrust Passport, will certainly help to leverage GovernmentFirst's efforts with municipalities."
The Avantrust Passport enables real-time verification of a company's identity and creditworthiness through an easy-to-use Web interface. Powered by credit and financial information from D&B's global database of more than 66 million business entities and proprietary credit algorithms created by AIG member companies, the Avantrust Passport provides PurchasePro buyers and suppliers with the information they need to make informed trading decisions, including recommended credit limits, recommended payment terms and a financial stability score.
Although useful to any company, the Avantrust Passport will be especially helpful to smaller government agencies and school districts that may lack some of the credit-checking resources available to large corporations.
Ken Day, executive vice president of GovernmentFirst, said, "We believe that the e-Source solution will be instrumental to our success in attracting municipal governments to our portfolio of customers. Tough economic cycles like the one we are in are not only challenging for private sector companies, but the public sector as well. As the economy has slowed, many government agencies have seen budget surpluses dwindle and tax revenues decline.
"Driving hard costs down and increasing efficiency is critical for government agencies and educational institutions as they are challenged to provide increased levels of service to their constituents with less incoming revenue. We have derived great success from the use of the PurchasePro e-Procurement software and expect to leverage that advantage with the company's e-Source solution in this, the beginning of a national rollout for GovernmentFirst."
About PurchasePro: PurchasePro(r), www.purchasepro.com, is a B2B e-commerce leader with the stated goal of providing software to enable enterprises of all sizes to gain universal access to the world's largest commerce network. The PurchasePro Commerce Network comprises more than 300,000 businesses, authorized to buy and sell, and powers hundreds of private-label marketplaces. PurchasePro provides the following B2B e-commerce solutions: e-Procurement for enterprise-wide procurement; e-Source for strategic sourcing; v-Distributor for online distributors; and e-MarketMaker for Internet market makers.
About GovernmentFirst: Founded in 2001, GovernmentFirst, www.egovernmentfirst.com, provides educational institutions, and state, county and city agencies with a new and exciting option for procuring goods and reducing costs associated with purchasing. For more information contact us at 888-873-5280, or visit us at our website.
This news release may include forward-looking statements, which are subject to the "Safe Harbor" created by Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements involve certain risks and uncertainties that can cause actual results to differ materially from those in the forward-looking statements. These forward-looking statements represent only the views of certain members of management and are based on limited information available to us now, which is subject to change. We have no current plan to update these statements. Actual results may differ substantially from what we say today and no one should assume at a later date that the forward-looking statements provided herein are still valid. They speak only as of today. For more information about these risks and uncertainties, see the SEC filings of PurchasePro.com, Inc., including the section titled "Factors That May Affect Results" in its 10-K filing for the period ended December 31, 2000, and its 10-Q for the quarter ended September 30, 2001, which are available from the company on request and on the Internet at the SEC's website, www.sec.gov.