FreeMarkets Announces Agreement with VTech; Leading Consumer Technology Company Selects FreeMarkets as Platform for Strategic Sourcing

Business Wire, April 16, 2002

Business Editors and High Tech Writers

BOCA RATON, Fla.--(BUSINESS WIRE)--April 16, 2002

FreeMarkets, Inc. (Nasdaq:FMKT), the leading global provider of sourcing software and service solutions, today announced that it has signed an agreement with VTech Telecommunications Limited, a leading global provider of high frequency cordless phones, and a wholly owned subsidiary of VTech Holdings Limited (SEHK: 303; London SE: VTH; ADR: VTKHY). The announcement was made at WorldSource 2002, FreeMarkets' second-annual global sourcing conference, which is being held at the Boca Resort & Club in Boca Raton, FL.

Under the terms of the agreement, VTech will use FreeMarkets(R) FullSource(TM) as a platform for sourcing materials and services for its global operations.

"VTech is committed to operating at the highest levels of efficiency and productivity, and is aggressively adopting and implementing innovative technology solutions that can help us achieve our goals," said James Kralik, CEO of VTech Telecommunications Limited. "Through its FullSource offering, FreeMarkets provides VTech with a unique combination of technology, information and services, which we will leverage to create online markets for a wide range of materials and services that deliver both cost reductions and sourcing process efficiencies to our organization."

Designed by sourcing professionals for sourcing professionals, FreeMarkets FullSource combines expert sourcing services in hundreds of spend categories; industry-specific program management; around the clock global market operations services; information and knowledge about specific commodities and supply market dynamics; and the most advanced e-sourcing technology available to create successful, high-performance markets for a wide range of materials and services.

"VTech is one of the leaders in both the development and application of industry-leading technologies, and we are very pleased that the company has selected FreeMarkets as its platform for strategic sourcing," said Daryl Rolley, Vice President and Managing Director, FreeMarkets Asia. "By leveraging our FullSource solution, VTech can achieve its most strategic business goals by creating online markets for direct materials as well as indirect goods and services that deliver immediate and ongoing results in the form of both savings and efficiencies."

About VTech

VTech Telecommunications Limited, a wholly owned subsidiary of VTech Holdings Limited, is a leading global provider of high frequency cordless phones. VTech is a leading consumer-focused technology company. It designs, manufactures, markets and sells telecommunication and electronic learning products through its extensive international distribution network. Backed by its excellence in technology manufacturing, the group also engages in contract manufacturing services. With sales over US$1.3 billion in FY2001, VTech currently has operations in 13 countries. The group invested over US$66 million in research and development in FY2001 and launches more than 80 innovative and high quality products each year.

About FreeMarkets

FreeMarkets is the leading global provider of sourcing software and service solutions. Through its unique combination of industry-leading, web-based software, in-depth supply market information, market operations and expert sourcing services, FreeMarkets has helped customers around the world source more than $30 billion in goods and services in over 195 different supply verticals and identify savings of $6.4 billion. FreeMarkets can be found on the Web at www.freemarkets.com. FreeMarkets(R) and BidWare(R) are registered trademarks of FreeMarkets, Inc., and FullSource(TM) and QuickSource(TM) are pending trademarks of FreeMarkets, Inc.

Forward-Looking Statements

Statements in this press release that are not historical facts, including those statements that refer to FreeMarkets' plans, prospects, expectations, financial projections, strategies, intentions, and beliefs, are forward-looking statements. These forward-looking statements are based on information available to FreeMarkets today, and FreeMarkets assumes no obligation to update these statements as circumstances change. There are risks and uncertainties that could cause actual results to differ materially from the forward-looking statements, including, without limitation, market acceptance of FreeMarkets' products and services, the competitive nature of the market for e-commerce products and services, FreeMarkets' ability to predict its revenues and earnings, FreeMarkets' ability to develop competitive new products and services on a timely basis, introduction of new products and services by competitors, declining or uncertain economic and industry conditions, FreeMarkets' ability to attract and retain personnel and other risk factors that are described in more detail in FreeMarkets' most recent Annual Report on Form 10-K/A, and its other filings with the Securities and Exchange Commission.