Press Release

August 4, 2003

eScout® and Perfect Commerce Consummate Deal

Closing $9.5 million funding round, company to operate under newly launched Perfect Commerce brand

Lee's Summit, Mo. and Palo Alto, Calif. August 4, 2003
eScout LLC and Perfect Commerce, Inc. today announced the closing of their previously announced merger. The merged company will operate under the name Perfect Commerce, Inc. Additionally, the combined entity has completed a $9.5 million round of new equity capital. SoundView Ventures led the new funding round and was joined by existing investors Mobius Venture Capital, New Enterprise Associates, Mayfield Fund, Wand Partners and other existing investors. The new funding will be used to enable expanded sales efforts, increased investment in development of product offerings, and future acquisitions.

"This transaction accelerates our delivery of a broader array of on-demand solutions for our clients, increases the size of the Open Supplier Network™ to 7,500 suppliers and strengthens our cash position in preparation for continued rapid growth," said Sandy Kemper, chairman and CEO of the new Perfect Commerce. "We are calling the new company Perfect Commerce because the name describes our founding focus on maximizing the buyer-supplier relationship, enabling our clients to utilize rapid, easy-to-use tools for the entire procurement process, streamlining everything from spend analysis to sourcing, purchasing, invoicing, payment and finance," added Kemper.

Commenting on the news of the merger, Pierre Mitchell of AMR Research said "Companies are spending way too much time doing e-sourcing vendor discovery before coming up with a shortlist of 20 vendors that gets whittled down to 3 to 5 during a vendor due diligence phase. This type of market consolidation culls the herd and provides users with valid options."

In closing the deal, the company also identified the executive team that will lead the new Perfect Commerce into the future. With offices in California and Nevada and its headquarters in the metropolitan area of Kansas City, Missouri, the following team will manage the company:

  • Sandy Kemper, chairman and chief executive officer
  • James McCormick, president and chief operations officer
  • Edward Foster, vice president and general counsel
  • William Graff, vice president, operations
  • Talbot Harty, vice president, product development
  • Greg Mark, vice president, customer service
  • Andrew Mies, chief financial officer
  • Ian Sullivan, vice president, sales and product strategy

"We are proud of our team and the promise of the new Perfect Commerce," said James McCormick, president and COO of the new company. "We know that this move will enable innovative developments in the e-commerce space and we are proud to deliver leading On-Demand SRM solutions and the Open Supplier Network™," added McCormick.

"Such on-demand solutions are built on a web-native, multi-tenant architecture - i.e. a single application instance serving multiple customers - that affords vendors great economies of scale, allowing them to offer competitive functionality at low-cost subscription-based pricing. For users, on-demand means supply management solutions can be deployed 60% faster and at a 40% lower cost," said Tim Minahan, vice president and managing director of Supply Chain Research at Aberdeen Group.

About Perfect Commerce, Inc.
Perfect Commerce delivers leading SRM solutions and the Open Supplier Network™. Perfect Commerce has more than 110 Global 2000 clients, 135,000 users and 7,500 suppliers. Perfect Commerce is focused on maximizing the buyer - supplier relationship and has enabled large volumes of transactions and savings for its clients. In the first half of 2003, the company's consolidated purchasing transaction volume exceeded 1.8 million, with dollar volumes reaching nearly $1.9 billion. The company's solutions have helped customers reduce costs by more than 15 percent, compress cycle time by up to 75 percent and significantly enhance the buyer - supplier relationship. Headquartered in the metropolitan area of Kansas City, Missouri, Perfect Commerce can be reached by phone at 866-889-8533 or via the Internet at www.perfect.com.

Forward Looking Statements
This press release contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management's current expectations and beliefs and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The forward-looking statements contained in this release include statements about future financial and operating results and the proposed merger.

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