HP to Power and Finance ePIT Internet Exchange Services for B2B, Commodities and Financial Markets

Business Wire, March 6, 2000

High Tech Writers

PALO ALTO, Calif. and SAN FRANCISCO--(BUSINESS WIRE)--March 6, 2000

ePIT to Expand On-tap Internet Exchange Services

with HP Technology, Services and Financing

Hewlett-Packard Company and ePIT Inc. today announced that ePIT will use HP technology, services and financing to expand the breadth and depth of its on-tap Internet exchange services. Through this agreement, ePIT will provide companies managing Business-to-Business (B2B), commodities and financial exchanges with a mission-critical technology infrastructure tuned for Internet commerce.

ePIT is an Internet start-up that began powering its first exchange -- AgEx.com, an Internet exchange for the $2 billion almond industry -- in January. ePIT has developed screen-based technology that brings the functionality and feel of the trading pit to the Internet in order to provide online traders with access to the same tools and information traditionally available only to professional traders in conventional trading pits. A pit is a place on a trading floor where buyers and sellers come together to trade securities and commodities using the "open-outcry" method, wherein buyers and sellers stand in the trading pit and continuously shout out their orders, competing for the best price in a dynamic market. The "no middleman" nature of open-outcry, as well as the inherent fairness and transparency of matching orders in a public forum, makes it ideal for the Internet.

ePIT's exchange system can be deployed through standard licensing agreements or through the Application Service Provider model with low upfront costs and pay-per-use pricing. The system is designed to facilitate seamless real-time or batch electronic clearance, banking, accounting and settlement services. Every facet of an ePIT trade is recorded in an audit database for use by regulators.

HP plans to provide ePIT with a range of UNIX(R) system and Windows NT(R) server, storage and software products, as well as consulting and outsourcing services. HP will power and manage ePIT's technology infrastructure, ensuring the highest levels of availability, security and scalability for ePIT and its customers. HP is providing ePIT with $8 million in financing to support the expansion of ePIT's operations and is taking warrants in the organization.

"ePIT will revolutionize the `open-outcry' system with great technology and a rock-solid management team," said Craig White, senior vice president and general manager of HP Technology Finance. "ePIT has identified a way to make the Internet work for entrepreneurs establishing new online markets for anything from electrical power, communications bandwidth, agricultural commodities, construction materials or foreign exchange to a wide variety of derivative products. ePIT also helps the more forward-thinking capital market trading exchanges migrate their legacy markets to the Internet before they are rendered obsolete."

"We see extraordinary opportunities to provide powerful, highly available, scalable and secure infrastructure with a level of technical sophistication that exceeds the demands of even the major regulated exchanges," said Richard Friesen, co-founder and president of ePIT. "In HP, we have found a partner that can provide the technology muscle, global reach, financing and mission-critical services and support that we need to deliver on our value proposition. HP's clear understanding of where the Internet is going and how it is redefining business models and markets is equally as valuable.

"ePIT meets both the present and future needs of exchanges," said Friesen. "ePIT provides exchanges with a cost-effective ability to migrate to new models -- from central hub and spoke to distributed; from fragmented to centralized; from HTML user interfaces to active pit-like rich environments; or from simple, negotiated auctions to continuous active markets."

About ePIT

Incorporated in 1998, ePIT Inc. is a San Francisco-based Internet exchange service company providing scalable, robust and secure Internet exchange services that support a wide range of business-to-business Net markets, regulated securities and futures exchanges. ePIT provides total exchange services solutions. Additional information about ePIT can be found on its Web site at www.epit.com.

About HP

Hewlett-Packard Company -- a leading global provider of computing and imaging solutions and services for business and home -- is focused on capitalizing on the opportunities of the Internet and the proliferation of electronic services.

HP plans to spin off Agilent Technologies and distribute its shares to HP shareowners by mid-calendar year 2000. Agilent consists of HP's test and measurement, semiconductor products, chemical analysis and healthcare solutions businesses, and has leading positions in multiple market segments.

HP has 85,400 employees worldwide and had total revenue from continuing operations of $42.4 billion in its 1999 fiscal year. Information about HP, its products and the company's Year 2000 program can be found on the World Wide Web at http://www.hp.com.